Timothy Winter
Timothy Winter, CFA, is an equity analyst and portfolio manager for the Gabelli Utilities AAA fund (GABUX), St. Louis. He is a three-time Wall Street Journal “All-Star Analyst.” Gabelli.com
One of the largest environmental cleanups is underway. Since the 1940s, man-made polyfluoroalkyl substances (PFAS) have been used to fortify products from carpeting to nonstick pans. They offer durability and resistance to water, grease and heat. Problem: PFAS are linked to risks for cancer, according to the National Institutes of Health. Dubbed “forever” chemicals, they take thousands of years to break down. Almost half of the nation’s tap water has one or more types of PFAS. This year, the Environmental Protection Agency proposed limits for six PFAS in drinking water, setting off remediation efforts among the 55,000 local, state and regional water utilities and systems. The cleanup effort will cost $50 billion over the next few years. That money will come, in part, from lawsuit settlements. Both 3M and DuPont have already agreed to pay nearly $15 billion in total to settle claims.
Stocks likely to benefit from the cleanup…
AECOM (ACM). The infrastructureconsulting firm has developed the technology DE-FLUORO, which destroys PFAS through electrochemical oxidation. Recent share price: $93.98.*
American Water Works (AWK), the largest investor-owned US water and wastewater utility that serves 16 states, stands to benefit from acquiring smaller water utilities because of consolidation in this highly fragmented industry. Recent share price: $122.28.
Xylem (XYL) offers equipment and services through its subsidiary Evoqua, which uses activated-carbon-filtering systems to remediate contamination in drinking water and industrial wastewater. Recent share price: $132.59. *All performance figures are from Morningstar, Inc., as of April 29, 2024.
