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The 'Bomb Cyclone' Portfolio: Winners And Losers

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The 'Bomb Cyclone' Portfolio: Winners And Losers

East Coast Americans are in deep hibernation during this week’s wild winter weather. 

Thirteen states between Maine and South Carolina were under winter storm warning with hurricane-force winds and blinding snow. Five governors declared states of emergency, and most urged residents to stay indoors.

"The situation has continued to deteriorate," New York Gov. Andrew Cuomo said Thursday.

The economic impact of weather-driven changes in consumer behavior may affect your portfolio. Here are some potential winners and losers:

Losers: Travel And Transportation

On Thursday, alone, Delta Air Lines, Inc. (NYSE: DAL), American Airlines Group Inc (NASDAQ: AAL), United Continental Holdings Inc (NYSE: UAL), Southwest Airlines Co (NYSE: LUV) and Spirit Airlines Incorporated (NYSE: SAVE) cancelled 4,300 flights and delayed more than 2,000. Airports from New York’s JFK International to North Carolina’s Charleston International closed down entirely.

Travelers found few alternatives. States warned drivers to stay off roads, which probably routed traffic away from Exxon Mobil Corporation (NYSE: XOM) and Chevron Corporation (NYSE: CVX).

Losers: Supply Chain And Delivery

The hazardous conditions grounded not only leisure travelers but also commercial deliverers. The American Trucking Association, representing 37,000 fleets, advised members to use caution on their routes.

"There's no load, there's no delivery that's that important," spokesman Sean McNally said. "The supply chain is resilient enough to deal with these weather-induced delays."

Undetermined: Retail

Such delays may cut the cache of retail stockrooms, which are already known to lose foot traffic in poor weather. But their storm-day losses could be offset by proactive purchases.

Bulk buys at Costco Wholesale Corporation (NASDAQ: COST) and Wal-Mart Stores Inc (NYSE: WMT) ensured a few days of sustenance, and runs to Dicks Sporting Goods Inc (NYSE: DKS) for snowshoes and a VF Corp (NYSE: VFC) North Face readied residents for unexpected excursions.

And Amazon.com, Inc. (NASDAQ: AMZN) can now take in the homebound non-discretionary buyers.

Mixed: Eats And Entertainment

The day trip to Walt Disney Co (NYSE: DIS)’s theme parks or Six Flags Entertainment Corp (NYSE: SIX) have been pushed to warmer days, and Cinemark Holdings, Inc. (NYSE: CNK) and AMC Entertainment Holdings Inc (NYSE: AMC) will have to wait until tomorrow.

In the meantime, a cozy couch pairs well with a daylong Netflix, Inc. (NASDAQ: NFLX) binge. If the queue is looking bare, there’s always Roku Inc (NASDAQ: ROKU) or the classic Comcast Corporation (NASDAQ: CMCSA).

And while dinner at DineEquity Inc (NYSE: DIN) and Darden Restaurants, Inc. (NYSE: DRI) and a bar night at Buffalo Wild Wings (NASDAQ: BWLD) and Brinker International, Inc. (NYSE: EAT) have likely been postponed, that leaves room for Domino’s Pizza, Inc. (NYSE: DPZ) and Blue Apron Holdings Inc (NYSE: APRN) to prey on the underprepared who are stuck with a bare cupboard. 

Winners: Hotels

More than 100,000 homes and businesses have lost power, driving consumers to hole up in hotels like Hilton Worldwide Holdings Inc (NYSE: HLT), Hyatt Hotels Corporation (NYSE: H) and Marriott International Inc (NASDAQ: MAR).

Winners: Home And Heat

Prescient consumers preempted outages with Generac Holdings Inc. (NYSE: GNRC) devices, and others will prep for home repair with Home Depot Inc (NYSE: HD) and Lowe’s Companies, Inc. (NYSE: LOW) runs.

And, provided the infrastructure holds, NRG Energy Inc (NYSE: NRG) and Dominion Energy Inc (NYSE: D) are poised to profit on soaring utility bills as consumers crank the thermostat.

Losers: Insurance

The storm, compounded by high tides, brought Boston’s worst coastal flood in 40 years, which will force losses in regional auto and home insurers, like Allstate Corp (NYSE: ALL) or Berkshire Hathaway Inc. (NYSE: BRK.A)'s GEICO.

Winners: Health Care

Cold-suppressed immune systems call for a CVS Health Corp (NYSE: CVS) or Walgreens Boots Alliance Inc (NASDAQ: WBA) run. And consumers may soon hit the shelves to stock up on Pfizer Inc. (NYSE: PFE), Johnson & Johnson (NYSE: JNJ) and Procter & Gamble Co (NYSE: PG)’s cold cures.

Related Links:

How Recent Hurricanes And Earthquakes Can Actually Benefit Reinsurance Investors

Cramer: The Bull Market Is Fueled By These 7 Negative Catalysts That Turned Positive

Generators To Insurers: Trading Tropical Storms

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