Watch as profits and dividends skyrocket this summer for these three seasonal businesses that perform best in the second and third quarter of the year. Now is the time to start accumulating a position in these stocks that could return high double-digits by late fall of this year.
You have probably noticed that gasoline prices are starting to rise and have increased quite a bit in just the last few weeks. In my area, gas is up about 60 cents per gallon and seems to be climbing every day. The stocks that see immediate profit increases from higher fuel prices are usually the refining companies. The cyclical nature of the refining business has set these stocks up for some very nice gains between now and next fall, and dividend focused investors can count on some nice quarterly payouts.
Refining is an interesting industry to analyze because the prices of both the raw material, crude oil, and end product, gasoline, diesel, heating and jet fuel, are set in the commodity markets. This means that gross refining margins, usually measured on a per barrel basis, are mostly out of control of the refining companies. The factors these businesses do control are their refining efficiencies, which drive down the expenses to refine a barrel, and their sourcing practices, where they buy and how they transport crude oil.