Natural disasters

RECENT NEWS
FiercePharma  9 hrs ago  Comment 
If you've spent any time reading biopharma's securities filings, you've noticed the litany of potential problems every company discloses--everything from natural disasters and terrorist attacks to patent lawsuits and regulatory setbacks.
Business Times - Malaysia  Jun 9  Comment 
THE two earthquakes, one measuring 6.1 and the other 4.3 on the Richter scale and epicentred in Ranau that shook Sabah recently, leaving a trail of destruction, have blown away the belief that we are free from natural disasters.
Clusterstock  Jun 7  Comment 
Some big names in the hedge fund world came together last week to raise money for victims of natural disasters — and to go head-to-head in the boxing ring. They were inspired by the story of Petra Němcová, a former Victoria's Secret model...
The Hindu Business Line  Jun 2  Comment 
Destructive as they may be, natural disasters offer nations a window of opportunity to rebuild themselves
Cellular News  Jun 1  Comment 
As the Caribbean prepares for the upcoming hurricane season, CandW has begun to test drone technology that would help expedite network and connectivity restoration in the aftermath of natural disasters such as a hurricane or a tropical storm....
Forbes  May 26  Comment 
Keeping people safe from hurricanes, tsunamis, and other natural disasters just got easier - which is good news, since this is National Hurricane Week! Thanks to some innovative desktop apps working behind the scenes, emergency planners in local...
guardian.co.uk  May 25  Comment 
As debate builds over the anticipated arrival of lethal autonomous robots, a growing number of robotic applications are being directed at enhancing humans’ existence and saving their lives Aerial drones can be used to locate disaster survivors...
Forbes  May 12  Comment 
Mapping, data and real-time weather feeds help firms increase profits in recreational sales and respond faster after natural disasters.
The Times of India  May 11  Comment 
You can't stop calamities but you can minimize their impact on your finances.




 
TOP CONTRIBUTORS

A natural disaster is the consequence of a natural hazard (e.g. hurricane, volcanic eruption, earthquake, landslide) which moves from potential in to an active phase, and as a result affects human activities[1]. Business is one such activity.

The International Red Cross, which publishes an annual World Disasters Report, says the economic cost of natural disasters has skyrocketed. In the past two decades alone, direct economic losses from natural disasters multiplied five fold to US$629 billion. Annual direct losses from weather-related events increased from an estimated $3.9 billion in the 1950s to $63 billion in the 1990s[2].

Natural disasters tend to affect insurance companies as well as local businesses affected by the disaster. The impact on other businesses can vary. For example, disruption in the oil drilling and refining activities in the Gulf of Mexico during the 2005 hurricane season caused some companies to lose revenue due to the loss of productive capacity, but also caused the price of oil to increase thus benefiting others in the industry. Landstar System, which has a contract to provide trucking services to the U.S. Government in the aftermath of natural disasters, was also a beneficiary[3].

Some studies have suggested that commodities provide an effective hedge against natural disasters because disasters such as floods, drought and hurricanes can affect commodity supply (see oil example above) and increase the price. However, the effect can differ across commodities - a drought could cause a shortage of corn and increase corn prices. The higher corn prices raises feed prices, which could cause ranchers to slaughter cattle earlier than usual and depress the price of that commodity in the short term.

Companies with negative exposure

Many companies are adversely impacted by the threat or actuality of natural disasters. Some include:

  • Property & Casualty insurance companies
  • Homebuilders and REITs with exposure to earthquake or hurricane prone regions
  • Travel and vacation companies, including cruise lines like Carnival (CCL) and Royal Caribbean Cruises (RCL) who operate in the Caribbean, where hurricanes are most common.
Wikinvest © 2006, 2007, 2008, 2009, 2010, 2011, 2012. Use of this site is subject to express Terms of Service, Privacy Policy, and Disclaimer. By continuing past this page, you agree to abide by these terms. Any information provided by Wikinvest, including but not limited to company data, competitors, business analysis, market share, sales revenues and other operating metrics, earnings call analysis, conference call transcripts, industry information, or price targets should not be construed as research, trading tips or recommendations, or investment advice and is provided with no warrants as to its accuracy. Stock market data, including US and International equity symbols, stock quotes, share prices, earnings ratios, and other fundamental data is provided by data partners. Stock market quotes delayed at least 15 minutes for NASDAQ, 20 mins for NYSE and AMEX. Market data by Xignite. See data providers for more details. Company names, products, services and branding cited herein may be trademarks or registered trademarks of their respective owners. The use of trademarks or service marks of another is not a representation that the other is affiliated with, sponsors, is sponsored by, endorses, or is endorsed by Wikinvest.
Powered by MediaWiki