After a decade of disappointment for energy stocks, it is not surprising that when oil’s collapse really accelerated back in early March, anything even vaguely related to oil got hammered. When a sector sells off like that though, there are usually a few stocks that, when you look back after the dust has settled, just shouldn’t logically have gone with everything else.

A good example would be DMC Global Inc. (BOOM).

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For starters, not all of their business is directly connected to energy. DMC is the parent of two separate companies, DynaEnergetics and NobelClad. The first is the energy connection, and more on that in a minute. The second, NobelClad is one of the world’s leaders in explosion welding and cladding. They basically use explosive power to weld together different metals and create vessels and parts that can be used in extreme conditions, such as under enormous pressure and at extremes of temperature.

NobelClad is the smaller of the two companies, accounting for only 22% of sales in 2019, but there are opportunities there for growth. For example, they make blast shields for rocket pads, which with the recent successful launches by private companies looks like being a growth area. Some of their business is also energy-related, but more in the areas of power generation and transmission, so NobelClad does provide some valuable diversification.

As the world recovers from the economic shock from the pandemic, that…


Via Oilprice.com

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