BY MICHAEL BRUSH
Is this the year we finally say hasta la vista to the five-decade-old Cuban trade embargo?
Tom Herzfeld, a Miami-area fund manager who studies Cuba-U.S. relations, thinks so. This is an unconventional view. But stranger things have happened in the past few years, like the Arab Spring. Besides, it’s often the unexpected that provides the best returns in investing.
And here, the investment implications could be big, for several companies.
Herzfeld thinks the policy change would boost companies as diverse as cruise line operator Carnival(CCL +0.70%, news), cargo shipper Seaboard (SEB -0.12%, news), regional airline Copa (CPA -1.77%,news), soft-drink distributor Coca-Cola Femsa (KOF +0.39%, news) and even Watsco (WSO +0.85%, news), which likely would sell more air conditioners in Cuba.
These stocks are all big holdings in the Herzfeld Caribbean Basin (CUBA -0.12%, news) fund, which Herzfeld says he has positioned to benefit from embargo elimination.
“Now, more than ever, the pieces are falling into place where the embargo could be lifted this year,” maintains Herzfeld.