Generac Investors: Thanks, Hurricane Joaquin
- Generac Holdings Inc. (NYSE: GNRC) is a designer and manufacturer of power generation equipment and serves the residential, light commercial, industrial, oil and gas, and construction markets.
- Shares of Generac gained 3 percent on Thursday (adding to Wednesday's surge) as Hurricane Joaquin is heading north from the Bahamas and expected to make landfall soon.
- CNN noted Joaquin will became a "major" hurricane and will "only get stronger."
Shares of Generac surged higher during Wednesday's session as investors and traders were betting on the company benefiting from a surge in sales due to Hurricane Joaquin.
The company is the No. 1 maker of home standby and portable generators and saw its sales surge ahead of Hurricane Sandy devastating the East Coast that left millions of homeowners and businesses without electricity.
"We believe that this event, as well as other recent outages, will have a positive impact on our results," Bloomberg quoted Generac's CEO Aaron Jagdfeld as saying during a conference call with investors back in 2012. He also said, "We see a spike in sales [following big outages], and that spike in sales settles down into a baseline that was higher than the previous baseline, prior to the events."
Shares of Generac continued climbing higher on Thursday as news reports and forecasts confirm that the hurricane is likely making its way north from the Bahamas and is likely to touchdown in the US.
CNN noted that the storm remains at Category 3 but has strengthened. It is showing maximum sustained winds of 125 miles per hour. The forecast added that the already "powerful" tropical system became a "major hurricane" overnight, and over the next day, it will only get stronger.
"The good news: If current projections hold, Joaquin won't be another Sandy," CNN said. "The not-so-good news: Hurricane projections are notoriously unpredictable."
Nevertheless, the Hurricane will "probably" cause "plenty" of rain and more flooding along an "already soaked" East Coast.
The New York Post reiterated that while current projections are uncertain, "some forecasters were sounding the alarm." The publication cited Steven DiMartino, a meteorologist at NY NJ PA Weather, who told NJ.com that: "People need to...start preparing for the worst. We have to watch this very carefully."
Finally, New York's Governor Andrew Cuomo took to Twitter, encouraging homeowners to "take precautions" and buy emergency supplies. If these precautions include power generators, shares of Generac may see even further upside.
— Andrew Cuomo (@NYGovCuomo) October 1, 2015
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