Rebuilding Gaza. American Companies Are Likely to Benefit.

A Google Maps location of the Gaza Strip, which is prime real estate along the Mediterranean Sea.

Rebuilding Gaza. American Companies Are Likely to Benefit. 
On Sunday morning, Israel delayed releasing the 620 Palestinian prisoners that were part of the Ceasefire Deal. Israel has fresh demands, including an end to the “humiliating ceremonies” that Gazans conduct when welcoming them home. Almost daily there is a new snag, a fresh complaint, and yet, at least so far, the ceasefire has moved forward, albeit on a bumpy road. Negotiations on the 2nd phase of the peace deal have been delayed since February 4, 2025, and have been frozen by Hamas until the 620 prisoners are released.

The Israel-Gaza Ceasefire is fragile. And yet, as the world is keenly aware, there is now a debate over who will rebuild Gaza. The American President and Israeli Prime Minister want the U.S. to turn Gaza into the Riviera of the Middle East, removing Gazans in the process. Leaders from Jordan, Egypt, Saudi Arabia, the United Arab Emirates and Qatar met in the Saudi capital, Riyadh, on Friday, Feb. 21, 2025, to come up with a counterproposal that would allow Gazans to stay and progress toward a two-state solution.

Each country has a horse in this race, and a reason why their plan is best. Which will ultimately be the path forward is still to be determined. However, there are a few things that are almost assured. The Arab World has the money. U.S. companies are likely to be involved in the rebuild. Since whale investors like to be early, which companies might be contracted to rebuild Gaza? Should you invest now to anticipate a rise in share price?
 
Here are the topics we’ll cover in this blog.
 
Roads, Buildings, Water, Elevators
Single Digit Revenue Growth (or Declining Sales)
Expensive Stock
Loaded Up With Debt
DJIA vs. S&P500 vs. Magnificent 7
Can Gaza (Pacific Palisades and Altadena, Too) Become the World's Cleanest City?
 
And here is more information on each point.

Roads, Buildings, Water, Elevators
Everything will have to be rebuilt. In my infrastructure Stock Report Card, I looked at 3 Dow Jones Industrial Average components: Honeywell, Caterpillar and Sherwin-Williams. I also included Granite Construction, Otis Worldwide, Deere & Co. and Pentair (water). If you might be interested in receiving a copy of my Infrastructure Stock Report Card, email [email protected]. If you have another company to suggest, email as well.

Single Digit Revenue Growth (or Declining Sales)
Many of the companies mentioned above have single digit or flat revenue growth year over year, with the exception of Caterpillar and Deere & Co., which saw revenue decline -5.01% and -30.18% in the most recent quarter, respectively. The estimated cost of the rebuild has been pegged at $50 billion, which will be spread out over multiple companies and projects. If a smaller company, such as Granite or Pentair, lands a contract, this could definitely bump up their revenue. So, it’s worth having our radar up for more details on this project as it unfolds. A rebuild project for Caterpillar might help revenue become more normalized, while Deere & Co. will still need more help to crawl back to the 2023 & 2024 revenue levels.

Expensive Stock
With the exception of Caterpillar’s 15.41 P/E, the companies I examined all had elevated equity prices, ranging from P/Es of 21.72 (Deere & Co.) to 32.67 (Sherwin-Williams) and 33.46 (Granite). The historical average of P/Es (since 1936) is in the 17.74 range. For context, Sherwin-Williams had a net profit of $2.68 billion in 2024, while the company’s market value is $86.61 billion. (Wouldn’t you love for your company to be worth that much more than you earn!)

While stocks can certainly go higher, whenever we have very lofty valuations, the slightest bit of bad news can prompt oversized plunges in price. High expectations are already built in. In the case of all the companies that I examined, buying now would be purchasing close to an all-time high.

Loaded Up With Debt
Otis Worldwide, Sherwin-Williams and Pentair are all rated BBB – the lowest rung of investment grade. Honeywell’s A rating is on negative watch. These infrastructure companies are all loaded up with debt – with debt-equity ratios ranging from 1.67 (Honeywell) to 2.86 (Deere & Co.). Over half of the S&P500 companies are at or near junk status, so this isn’t that surprising, particularly since older companies tend to be the ones with flat growth and massive debt.

DJIA vs. S&P500 vs. Magnificent 7
The Dow Jones Industrial Average has only 30 companies. While it now includes 3 of the Magnificent 7 companies* (Apple, Microsoft and Nvidia), it also has a great deal of last-century companies that are heavily indebted with low profit margins, and slow or negative earnings growth. The index has been severely underperforming the S&P500, as you can see in the chart below.  
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Source: MSN.com. (c) Microsoft 2025. Used with permission.

*Magnificent 7 companies: Alphabet (Google), Amazon, Apple, Meta (Facebook, Instagram, Whatsapp), Microsoft, Nvidia and Tesla.

The Magnificent 7 companies were responsible for over half of the gains of the S&P500 over the past two years. The S&P500 had 25.02% total return in 2024, and 26.29% in 2023.
If you don’t have large cap growth, but are instead focused on DJIA funds, you’re missing out on a lot of Wall Street’s gains. In our sample pie charts, we look to international substitutions for our value funds, where we often get a higher yield, and sometimes for a lower risk. (Warren Buffett has also been shopping outside the U.S. for his investments of late.)

Natalie’s Note: Tesla is down -31% since its Dec. 2024 high and is no longer so magnificent. Learn why in my 2025 Crystal Ball blog, which includes information on EVs and other select industries, including artificial intelligence, cybersecurity and crypto.

Can Gaza (Pacific Palisades and Altadena, Too) Become the World's Cleanest City?
You may say I’m a dreamer… However...
With a blank slate for these areas, can we create Edens that become exemplar destinations? Are you aware that most Europeans have 1/3 the CO2 footprint (per capita) of Americans, Australians, Canadians and people living in the Middle East? What would it take? Check out my blog on Creating Eden in Gaza. (Click to access.)

Bottom Line
It’s easy to fall into the trap of shopping the headlines for Wall Street opportunities. However, a deeper dive into at least some of the U.S. companies that stand to benefit from rebuilding Gaza (and after the L.A. Fires) reveals that:

• The good news is already priced in (we’re buying high!),
• The companies have debt and other obligations weighing on their profit margins, which could potentially negatively impact share price, and,
• Expensive equities plunge when impatient investors’ expectations are not met.

While our age-appropriate, diversified wealth plan that we rebalance 1-3 times a year rarely makes headlines (though it should and should be taught in high school and college!), it’s a simple, time-proven system that works – particularly when you lean into growth, underweight sluggishness and debt, and add in hot industries, such as artificial intelligence, cybersecurity and even crypto. While that might sound like a lot of work, it’s actually as easy as a pie chart.

So, now is the time to make sure we know what we own, rather than jumping into a Gaza Rebuild hot tip or headline. Having said that, if you hear about specific companies that are part of the deal, be sure to email us at [email protected]. As I mentioned, the project could be a bump for smaller companies.


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Join us for our Online Spring Financial Freedom Retreat April 25-27, 2025. Email [email protected] or call 310-430-2397 to learn more. Register by Feb. 28, 2025, to receive the best price. Click for testimonials, pricing, hours & details.

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Natalie Wynne Pace is an Advocate for Sustainability, Financial Literacy & Women's Empowerment. Natalie is the bestselling author of The ABCs of Money (6th edition) and The Power of 8 Billion: It's Up to Us, and is the co-creator of the Earth Gratitude Project. She has been ranked as a No. 1 stock picker, above over 835 A-list pundits, by an independent tracking agency (TipsTraders). Her book The ABCs of Money remained at or near the #1 Investing Basics e-book on Amazon for over 3 years (in its vertical), with over 120,000 downloads and a mean 5-star ranking. The 6th edition of The ABCs of Money and the 2nd edition of Put Your Money Where Your Heart Is (2nd edition) are the most recent releases of these books. Follow her on Instagram. 
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Natalie Pace's easy as a pie chart nest egg strategies earned gains in the last two recessions and have outperformed the bull markets in between. That is why her Investor Educational Retreats, books and private coaching are enthusiastically recommended by Nobel Prize winning economist Gary S. Becker, TD AMERITRADE chairman Joe Moglia, Kay Koplovitz and many Main Street investors who have transformed their lives using her Thrive Budget and investing strategies. Click to view a video testimonial from Nilo Bolden.​​

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Important Disclaimers
Please note: Natalie Pace does not act or operate like a broker. She reports on financial news, and is one of the most trusted sources of financial literacy, education and forensic analysis in the world. Natalie Pace educates and informs individual investors to give investors a competitive edge in their personal decision-making. Any publicly-traded companies, funds or projects mentioned by Natalie Pace are not intended to be buy or sell recommendations.

ALWAYS do your research and consult an experienced, reputable financial professional before buying or selling any security, and consider your long-term goals and strategies. Investors should NOT be all in on any asset class or individual stocks. Your retirement plan should reflect an age-appropriate, diversified wealth plan, which has been designed strategically, with the assistance of financial professionals who are familiar with your goals, risk tolerance, tax needs and more. The "trading" portion of your portfolio should be a very small part of your investment strategy, and the amount of money you invest into individual companies should never be greater than your experience, wisdom, knowledge, patience and diversified strategy.  
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Information has been obtained from sources believed to be reliable. However, NataliePace.com does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this publication and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument.