Overseas worries won’t stop the garbage man from doing his job….
No matter what happens overseas or even in the States, it is highly unlikely that we will decide to stop having someone haul away our trash for us. This is why Waste Management, Inc. (NYSE:WM) makes a good investment as a domestic, defensive play. It’s not the most exciting company in the world — I know.
Consider this though, the trash company yields nearly 4% and is trading at around 16 times earnings going forward. The company also has some unique prospects that many don’t seem to notice. All that trash they get paid to collect from us may become a future green energy source, and is already being implemented according to the company, which states that:
“Our 110 landfill-gas-to-energy projects currently generate enough energy to power 400,000 homes every day offsetting almost two million tons of coal per year. These projects also reduce emissions of greenhouse gases into the atmosphere. It’s a true win-win for both companies and communities like yours.”
Besides leading in landfill-to-gas energy technology, the company also seems to be ahead of the curve with utilizing natural gas as a cheaper fuel source. The company began converting its fleet of vehicles to utilize compressed natural gas (CNG) about three years ago, and has apparently been adding more CNG converted vehicles to its fleet at a pace of over 700 per year. It is estimated that the company saves up to $30,000 per truck annually on fuel and maintenance.
The bottom line
There are companies that operate primarily within the U.S. with little exposure to events occurring overseas. With the exception of AT&T (which is poised to grow from the mobile revolution), these companies often operate in low-growth, saturated markets with high barriers of entry. They also tend to hold up better than most in bad times. All three companies are protected by their wide moats and dominate their markets. Buy these companies for domestically-defensive high yield, but don’t expect instant capital appreciation.
The article Avoid Overseas Drama! 3 Domestic High Yielders to Buy Today originally appeared on Fool.com and is written by Joseph Harry.
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