Hurricane Sandy, and the Stocks Helping Rebuild the East Coast

Helping Rebuild the East CoastThe tragic results from Hurricane Sandy are now starting to become apparent. With the death toll continuing to rise, both from the Caribbean nations as well as America, it is truly a sad event, and my hopes and prayers go to the families of those affected.

When a natural disaster such as Hurricane Sandy occurs, it is a stark reminder of the fragility of life. With the damages running into the multibillion-dollar range, the rebuilding effort from Hurricane Sandy will be extensive and costly. Early estimates have the economic costs at over $20.0 billion. (Source: Bloomberg, October 30, 2012.)

Two of the main stocks in the rebuilding market sector that will help citizens and businesses damaged by Hurricane Sandy include Lowes Companies, Inc. (NYSE/LOW) and The Home Depot, Inc. (NYSE/HD).

While the immediate thought is to first rescue any individuals in harm’s way, the next step is rebuilding life along the East Coast and resuming some semblance of normalcy. The home and business repair market sector, epitomized by both Lowes and The Home Depot, will certainly see an influx of business.

In preparation for Hurricane Sandy, many people and businesses have bought generators, batteries, rope, and other essential supplies. Once Hurricane Sandy has passed, this could mean additional large-item sales to replace what has been damaged. This is one market sector that is truly needed in this time, helping people rebuild their lives following a devastating natural event.

Home Depot Inc Chart

Chart courtesy of

In the home rebuilding market sector, even before Hurricane Sandy hit, The Home Depot is a clear outperformer. This is because of the rebound in the housing market sector, especially sales of foreclosed homes. With a large number of investors buying foreclosures for rental units, money does need to be spent on renovating these homes. This has led directly to an increase in sales for the home rebuilding market sector and stocks like The Home Depot.

Lowes Companies Inc Chart

Chart courtesy of

Lowes has also been a strong performer, although slightly more volatile. One thing to note with both stocks is that they have appeared to break their long-term uptrends. The stock market has been closed for a couple of days due to Hurricane Sandy, and we won’t know how investors will react when the markets reopen.

Prior to the closures of the stock exchanges due to Hurricane Sandy, both stocks appeared to have been intent on pulling back from their strong moves upward over the past few months. Many investors have gotten ahead of the rebound in the home rebuilding market sector and pushed shares upward to very bullish and optimistic viewpoints. Only time will tell the full extent of Hurricane Sandy and the amount spent in the rebuilding market sector to get life back to a somewhat normal state.