As smoke from Canadian wildfires sparks air-quality alerts, these stocks are grabbing attention

By James Rogers

The smoke from Canadian wildfires has sent air quality plummeting in much of the U.S. and Canada

The smoke from Canadian wildfires that blanketed Northeastern U.S. cities such as New York and Washington, D.C., earlier this month also covered Chicago and parts of the Midwest this week, sending air quality plummeting.

The smoky haze has prompted air-quality alerts in a number of states, highlighting the scale of the wildfire challenge facing North America. The Wall Street Journal reports that, since the start of this year's fire season, more than 2,900 fires have burned more than 19.2 million acres in Canada. The Canadian wildfire season typically lasts from May to September.

Millions of people across the U.S. and Canada are under air-quality alerts and warnings, and hazy conditions are expected to return to New York on Thursday. Set against this backdrop, demand for air purifiers has been surging, according to reports.

Related: Dangerous U.S. air from Canada's wildfires: Where does your city rank in the Air Quality Index?

On Wednesday Raymond James raised its fiscal year 2024 non-GAAP earnings-per-share and core-sales estimates for Helen of Troy Ltd. (HELE), due to demand for Honeywell International Inc. (HON) air purifiers. "The estimate changes reflect our expectation for higher sales of Honeywell air purifiers as a result of the Canadian wildfires, partly offset by an expectation for increased promotion due to muted demand in home-related categories," Raymond James analyst Olivia Tong wrote in a note, adding that in previous years, California wildfires led to a sales lift of an estimated $30 million for Helen of Troy.

Shares of Helen of Troy, which reports fiscal first-quarter results before market open on Monday, have risen 12.5% in the last month. Honeywell's stock is up 4.6% over the same period, outpacing the S&P 500's gain of 3.8%.

The environmental impact of the fires is immense, as is the need for the resources to tackle them and rebuild in their aftermath, according to exchange-traded-fund specialist ProcureAM. "Wildfires are burning out of control in North America and throughout the world with more predicted," ProcureAM said in a statement last week. "Products and services that prevent or extinguish major fires will continue to be in demand."

Related: 'Like unfiltered cigarettes': Why is wildfire smoke so dangerous for the lungs?

ProcureAM's Procure Disaster Recovery Strategy ETF's (FIXT) holdings include companies involved in wildfire response, prevention and recovery. This encompasses specialist vehicle manufacturer REV Group Inc. (REVG), fire-truck maker Oshkosh Corp. (OSK), infrastructure consulting firm AECOM (ACM) and Verisk Analytics Inc. (VRSK), which provides risk-analytics technology.

The ETF has risen 3.6% in the last month. "Wildfires are proliferating and the market for firefighting and prevention products and services will be busy," ProcureAM said in the statement.

-James Rogers

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06-29-23 1056ET

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