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Are water stocks a good investment in 2021?


You have no shortage of options when it comes to potential stocks to buy in 2021. Indeed, there are more options than there have been in decades. Of course, some stocks are better than others. One industry that may be worth checking out is the area of utilities – and specifically, water stocks. As noted by the financial experts at Money Morning, “Since water is such a sought-after commodity, investing in water stocks is a way to diversify your portfolio, potentially leading to life-changing wealth.”

These factors make water stocks a solid investment in 2021. Here’s an overview of the industry. 

Potential Water Stocks to Buy

There is no shortage of water stocks to buy. Many of these stocks are American-based, so they are subject to the laws of the federal governments and various states in the United States. These include Aqua America, EcoLab, American Water Works, Consolidated Water company, and more. These stocks also have an added bonus: They offer dividends. The yield is relatively low, usually around 1%, but this provides an added bonus if you are looking to purchase water stocks and achieve some level of diversity. Indeed, this is one of the chief benefits of water stocks: As a utility, they have a relatively strong cash position and are able to offer dividends in addition to their strong growth potential. 

If you are looking to diversify your portfolio with international water stocks, there are also a variety of options. For example, many Canadian water stocks exist that have tremendous potential for continued growth. These include Canadian Utilities, Pure Technologies, BluMetric Environmental, and H20 Innovation. 

If you are more interested in other international stocks that do business out of North America, don’t worry, there are plenty. With a bit of research, you’ll have no trouble finding a water company stock that fits your portfolio. 

Water Stock Growth and Growth Potential

For reasons related to both the necessities of life and our ongoing environmental crisis, water stocks show a real upside for financial growth. First of all, using water is obviously not a discretionary purchase. This means that water will always be in demand and that companies that buy and sell water have a built-in biological demand.

Second, water stocks have grown over the past few years. This is for many reasons, including the increase in demand and the fact that water infrastructure is aging. As a result, many public entities have turned their public utilities to private companies. These companies are often able to make cheaper repairs and lack the political barriers that will stop them from raising rates in order to fund improvements.

It is also worth noting that there are many environmental challenges taking place throughout the world. These issues have made freshwater less plentiful, particularly in the face of population growth. As a result, private companies have become more in demand, and as water resources get more scarce, these companies do have the chance to turn more of a profit.

In many cases, water stocks remain a sound, stable investment, one that is absolutely worth pursuing. They can help you diversify your portfolio and often make for a very sound investment.

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