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How Record Cold Temperatures Could Heat Up Your Portfolio


Quant Ratings - How Record Cold Temperatures Could Heat Up Your Portfolio

We’re still a few weeks away from the start of winter, but it’s already pretty cold out!

In the Mountain West, it’s been snowing since October. In fact, the snow is now at my Reno home, which is at a 5,000-foot elevation.

It’s also cold all over the world… there have been a lot of record-low temperatures already set in the Northern and Southern Hemispheres this year, including in tropical climates like those found in South America.

This year, around the world, we’ve seen record cold temperatures already in:

  • Tongulakh, Siberia (-62.4 degrees Centigrade)
  • Halifax airport, Nova Scotia (-45.4 degrees Centigrade)
  • Shepherd Bay, Nunavut, Canada (-49.6 degrees Centigrade)
  • Kinbrace in Scottish Highlands (-15.2 degrees Centigrade)
  • Mount Washington, New Hampshire (-78 degrees Centigrade)
  • Boston, Massachusetts (-23 degrees Centigrade)
  • Providence, Rhode Island (-23 degrees Centigrade)
  • Sydney, Australia (1.8 degrees Centigrade)

Not to mention the record low temperatures this year in the Southern Hemisphere in Argentina, Brazil, Chile and Uruguay. So, today I want to share with you why we are experiencing these cold temperatures… and how your portfolio can benefit from them – if you invest in the right stocks.

Wild Jet Stream Oscillations

The main reason for the extreme temperatures is due to a wild oscillating jet stream in the Northern Hemisphere and the polar jet stream in the Southern Hemisphere.

Now, the Northern jet stream and the Southern polar jet stream are oscillating because the magnetic poles are moving and will eventually shift, which they do every 60,000 years or so (that is how rocks are dated for all the magnetic pole shifts recorded).

In the Northern Hemisphere, the magnetic North Pole has been moving since being tracked in 1840 and appears to be getting ready to shift again. The net result is more wild jet stream oscillations, so we experience more extreme weather, both hot and cold.

So far, this winter is tracking better. Part of the reason why, and another reason for the extreme temperatures, is it’s an El Nino year. El Nino also influences the tropical jet streams in the Northern and Southern Hemispheres.

El Nino typically causes a wet winter in California and in the southern states. Also, when the jet stream dips during El Nino, it tends to dip farther east, and the northeast can become bitterly cold.

How the Cold Can Benefit Certain Stocks

One reason why I am focused on these record low temperatures is because they can affect natural gas prices – and ultimately natural gas stocks – this winter.

Colder temperatures can have a dramatic impact on natural gas demand in the winter months. We not only need cold weather for natural gas demand to rise, but we also need the cold temperatures to spread to populated areas where a lot of people live (think Chicago, New York, Boston, London, Berlin, etc.). Last year, it was cold out west but not in the northeast. So, natural gas demand moderated, and prices plunged.

However, now that we’re experiencing record-low temperatures, natural gas prices should rise. In addition, any arctic cold blasts in the northeast, as well as in Europe, should help boost natural gas prices, too.

This bodes well for fundamentally superior natural gas companies.

Take Dorian LPG Ltd. (LPG), for example. Dorian LPG operates a fleet of “very large gas carriers,” or VLGCs, that primarily haul liquified petroleum gas around the world. The company’s fleet consists of 22 VLGCs, each with the capacity to carry 1.8 million cubic meters (cbm). Dorian LPG has offices in the U.S., U.K., Greece and Denmark; and it partners with several big-name oil companies, including BP p.l.c. (BP) and Shell PLC (SHEL).

I should add that Dorian LPG has been a major outperformer this year – surging nearly 124%. You can see the stock’s rise in the chart below:

In comparison, the S&P 500 and Dow are up about 19% and 8.5%, respectively.

So, what’s been behind Dorian LPG’s strength?

It’s not just because of the increasingly cold weather. It’s also because of Dorian LPG’s stunning fundamentals…

The reality is the stock has been on fire since the company reported results for its second quarter in fiscal year 2024 on November 2. Second-quarter adjusted earnings surged 336% year-over-year to $75.0 million, or $1.85 per share, up from $17.2 million, or $0.43 per share, in the second quarter of 2023. The analyst community only expected earnings of $1.80 per share. Second-quarter revenue increased 90.5% year-over-year to $144.7 million.

Since the earnings report, shares of LPG are up more than 21% – and they even hit a new 52-week high this past Monday.

I’m pleased to say that I recommended Dorian LPG in Accelerated Profits in February 2023, allowing my subscribers to capture much of the stock’s rise. It’s up about 82% since my initial recommendation.

Now, I should note that I didn’t pick Dorian LPG at random. I use my revolutionary software Computational Risk-Integrated System for Income Stability, or “C.R.I.S.I.S. Cash” for short.

At its core, C.R.I.S.I.S. Cash uses a series of artificial intelligence algorithms to constantly scour massive amounts of data looking for patterns. Many of these patterns are nonlinear, meaning you’re not going to be able to see them with the naked eye. But the more data you feed it, the more patterns it can spot.

It’s what led me to Dorian LPG in February, and it’s how I’ve been able to find stocks that allowed my Accelerated Profits Buy List to soar nearly 10% higher in November, versus the S&P 500’s 8.9% gain and the Dow’s 8.8% rise. Breaking it down further, 30 stocks posted double-digit gains between 10% and 67% over the past four weeks.

So, if you’re cold and your portfolio is cooling down, put on a jacket and join me at Accelerated Profits today. You’ll be able to warm up your portfolio with stocks that do well in the cold and can outperform the broader market.

(Already an Accelerated Profits member? Log in to the members-only website here.)


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Louis Navellier

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The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:

Dorian LPG Ltd. (LPG) and Shell PLC (SHEL)

Article printed from InvestorPlace Media, https://investorplace.com/market360/2023/11/how-record-cold-temps-could-heat-your-portfolio/.

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