I’m diving in, actually, I’ve already taken the plunge into the pools of information that’s out there on the topic of the world’s water situation. It seems with every report I read, I get new ideas, and confirm old ones. I definitely am more informed, and have changed some opinions on certain names, since my overhaul on PHO. I’m by no means done learning about this sector, so please leave feedback if appropriate.
The world is about to spend $1 – $1.5 T over the next 20 years, to attempt to offset this sloppy problem:
As of 2006, one in three countries had water shortages.
Developing countries only use 11% of their water for industrial use. Developed countries us 42% of their supply for industrial use.
The World Bank’s Forecast for the Middle East and North Africa suggests a 50% fall in per-capita supply by 2050.
Dubai obtains 95%, Saudi Arabia 70%, of their water from desalination. Think about that, hard. Currently with desal, it takes 10MW to produce 100,000 L of water, making it 10x more expensive than harvesting rain water. Numbers confirming this have varied depending on the report you read. Apparently desal is 3x to 4x more efficient than it was 30 years ago…but same holds for lots of stuff.
In the UK, the infrastructure leaks 4.5B litres per day. That’s a bath-tub per person PER DAY.
Average infrastructure in the US is 60 – 80 years old, engineers say, they were built for 50.
Currently, the US subsidizes 50% of the countries drinking water.
In North America, we treat 100% of the water in municipal systems to levels safe for human consumption, but only actually consume 1%.
…ok, I’m tired of re-iterating facts, and yes I have references, good ones too – but I just don’t care if you believe me or not.
The entire global ‘Water’ sector, is valued at $425B, by Goldman Sachs. So quick math, there’s room for at least a doubling, and likely a tripling in market caps inside the next 10 years as the work and contracts fall into place. Since markets always over react, water will likely be a $2T industry by ~2020. …But I’m just a young go getter, trying to figure this mess out. I feel like I might be lagging the crowd in this investment thesis, because I’ve read lots of dated piece. Who knows(?) While I may have lived through many other macro economic trends, I’m too young to have completely experienced (and understood) them, although I have read of many.
I already own TTEK and I’m getting more and more confident, less and less embarrased in my HEK purchase I made a week ago for different reasons I won’t mention. VE is looking good to me at these levels, likely will also pull the trigger Monday. I want MIL, PNR, BMI, ITRI, a little cheaper, then I’ll be a buyer. ROP too. Going to keep my eye on INSU, first sign of strength, I’ll be on-top of it. Not sure if I want to bother with HYFLY.SI, valuation is a bit high.
I’ve said that I wasn’t sure infrastructure was the best way to invest, but I’m taking that back and I’m looking for ONE good infrastructure stock.
The following is funny twitter conversation about 3 tickers and only two stocks, along with some insight.
For a week now, I’ve been chasing CCC with limit orders, I might just pull the trigger Monday AM. You may or may not know this man and this man already did. Of course I asked what’s the better play? He answered. I looked at CLE, both of them, and was confused. But didn’t question him, and shrugged it off. “Probably a typo” I thought. I figured, he’ll probably blog it later. A day or two later, I learned about CLC in a report by Goldman Sachs. It took me reading one annual report to convince me to buy some CLC…the lights went on inside my head - turns out, my name wasn’t the only thing he made a typo on. I laughed. I think this is a sign…I’m buying some CLC tomorrow, and save a little cash for a pullback.
In my opinion, and I would like yours on this, the trend in water, along with solar, wind, global banks, green stuff, and nuclear is what my generation of investors should be riding. no? are there others? I’m talking 20 year trends here.
PS. I’m also finally buying CVA first thing in the AM too…but that’s another post.