Cuba Investment Opportunities
As Castro Announces his Retirement at 81, the stocks that could benefit.
The Herzfeld Caribbean Basin Fund (CUBA)http://www.herzfeld.com/cuba.htm invests in companies that are likely to benefit from the economic, political, structural and technological developments in the countries within the Caribbean Basin including Cuba, Jamaica, Trinidad & Tobago, the Bahamas, the Dominican Republic, Barbados, Aruba, Haiti, the Netherlands Antilles, Puerto Rico, Mexico, Honduras, Guatemala, Belize, costa Rica, Panama, Colombia, Venezuela, and the U.S.
Today, the Herzfeld Caribbean Basin Fund (CUBA) is up over 20%, and over 10% in 2008. The fund began trading in 1994.
*Note that the fund's performance longer term has been somewhat below average, but if sanctions are lifted analysts have always thought it could prosper.
The Caribbean Basin Fund is not a pure play on Cuba, but below are some U.S. companies, as well as companies that trade in the U.S., that stand to benefit if Cuba opens up to U.S. investment:
Royal Caribbean (RCL)
Carnival Cruise Lines (CCL)
Fortress Investment Group (FIG) through its acquisition of Florida East Coast Industries, and its commercial real estate and rail road company that formerly traded on the NYSE under ticker FLA.
Seaboard Corp (SEB) is a group of companies that include Seaboard Marine, a containerized shipping service between the U.S., the Caribbean Basin, and Central and South America, as well as Seaboard Foods and Commodity Training and Mining
Watsco (WSO) A distributor of heating and cooling equipment
Trailer Bridge (TRBR) a provider of integrated trucking and marine freight service to and from the U.S. and Puerto Rico and the Dominican Republic
Atlantic Tele-Network (ATNI) a telecom company with offices in Salem, MA and St. Thomas
Economic Timeline (The Canadian Press)
Jan, 1 1959: Dictator Batista flees Cuba and Fidel Castro takes power
February, 1960: Soviet Deputy Prime Minister Miloyan signs sugar and oil deals with Cuba
June, 1960: Cuba nationalizes U.S.-owned refineries after they refuse to process Soviet Oil
October, 1960: U.S. bans exports to Cuba except food and medicine
February, 7, 1962: U.S. bans all Cuban imports
July, 1972: Cuba joins the Soviet-led economic bloc, Comecon
December, 1991: Collapse of Soviet Union ends extensive aid and trade for Cuba
*Cuban economic output plunges 35% by 1994
December 16, 2001: The first shipments of direct U.S. food sales to Cuba in 40 yrs arrive of corn and chicken
Cuban Population: 11.4M
Main exports: sugar, nickel, tobacco, citrus, seafood
Imports: Oil, grains, oilseeds, chemicals, machinery