wearmanyhats

Back in 1999, the good folks at Charles Schwab held a series of workshops in Anchorage, and I was smart enough to jump at the chance to attend.  To give you an idea of how important of a transition period this was, let me tell you that online trades were at $29.99, (versus the 12.99) and there were still audience members who were raging about spending $120.00 going in and out of their trades at their traditional brokers. Online trading was still somewhat suspect.  The attendees were mostly retired, and some of them marveled at how young I was.  Most commented that they wished that they had started young with investing.  At that time, I had already been investing ten years and had been trading online for quite some time.

During a break, I entered into a conversation with an old gentleman who left an impression upon me that he must have been a risk taker of sorts.  “Yeah,” he said, “I bought a bunch of shares in The Chunnel.”  My eyebrow shot up.  “You know what that is?” he asked.  I nodded.  “Well,” he smiled, then shrugged.  “It didn’t cost me too much and I know I’ll never see it be worth anything in my lifetime, but I’m gonna leave it to my grandchildren.  It’ll be worth something in their lifetime.”

 That conversation left quite an impression upon me.  I wondered many times what stock I would buy and then throw into an account and never look at it again.  Could there ever be such a one? 

Today I came across one that I could feel good about tossing into an account and forgetting about.  It is one of the few that I think would probably be doing very fine in twenty years.  It’s Watt’s Water (WTS) and I think it will be worth far more in the future.

Now I can already hear the protests from the back of my brain.  The Chunnel stock was worth only pennies when the man bought it.  How does that compare with Watts?  Well, it is true that the comparison seems odd, but think about how important clean water will be in fifty years or even sooner.  Watts is one of the few stocks which benefits from the quest of what some folks call “Blue Oil.” 

There is a belief that water will become the most sought after commodity in the next twenty years or sooner.  There is evidence to support that hypothesis.  For example, consider that T. Boone Pickens and other such investors have been putting their money into private placements which are buying up water rights all over the world.  What will happen when the aquifers are owned by private companies?  It’s hard to say if that is what is best for the population of the United States, but that’s the wave of the future.

Watts supplies the materials to deal with water issues.  It purchases businesses that also manufacture water related devices.  It’s product is represented worldwide and every country on earth relies on some of their components to supply safe drinking water to their people.   And if you think about the sheer quantity of countries that are updating their water supply, someone like WTS will have an open door to generate more revenue.

So why do bring up WTS now? Consider that wonderful run up in oil price recently.  What if that were the price of water?  The shortage of good, drinkable water has not hit yet. How long will affordable water be there when we have eight billion people on the planet and more to come?  Right now WTS is still inexpensive now and on the rise.  It has a P/E under 20 and the insiders are trading like crazy.  They aren’t necessarily only buying, they are selling, too. So it is not a steal of a price, but it sounds as though the people who make a difference in the company know that this is a stock that will be doing well in the future. 

I bought Watts Water at 27 and got impatient.  I’m one of those people that like my numbers at the end of the month to be up significantly.  But if I had patience, if I had an account I didn’t see a lot, Watts is one I toss in and forget.  The future is brighter for and because of them.

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