3 Infrastructure Stocks To Watch Right Now
With the Senate’s latest update on President Biden’s infrastructure bill, infrastructure stocks could be taking center stage. This section of the stock market would be in focus now as the Senate voted to advance a bipartisan infrastructure plan. By doing so, the process of debating and amending the bill is now underway. Ideally, the current $550 billion in new funding towards vital U.S. infrastructure will serve to further bolster the U.S. economy. In detail, key areas highlighted in the bill include the transportation, utilities, and broadband segments. Now that the bill is another step closer to getting passed, I could once again see investors looking for the top infrastructure stocks in the stock market today.
For the most part, companies in the industrial market will likely be a key area of focus for investors now. On one hand, you have names such as Martin Marietta Materials (NYSE: MLM) and Freeport-McMoRan (NYSE: FCX). These would mainly be providers of the raw materials needed to carry out massive construction projects funded by the bill. On the other hand, investors should also consider companies that supply the necessary equipment needed to carry out the work. For instance, we could look at the likes of United Rentals (NYSE: URI) in this case. As it stands, all three companies’ stocks are now looking at gains of over 120% since their respective pandemic-era lows.
Overall, it makes sense that investors are keen on infrastructure stocks now. Most would argue that as the economy continues on the uptrend, infrastructure stocks will likely follow suit. Should you be looking to add some to your watchlist, here are three worth noting now.
Top Infrastructure Stocks To Watch Now
Nucor Corporation
To begin with, we will be taking a look at the Nucor Corporation. The North Carolina-based company is a leading name in the steel production industry. In fact, it is the largest steel producer in the U.S. to date. At the same time, Nucor is also the biggest recycler of scrap in the North American region. Now, Nucor’s offerings would be in demand with the passing of this infrastructure bill. With steel being one of, if not the most crucial element of most infrastructure today, that would be the case. More importantly, NUE stock is currently sitting on year-to-date gains of 89%. With the latest developments, could the company’s shares have more room to run?
While that remains to be seen, Nucor does not seem to be sitting idly by right now. On the financial front, the company reported record figures in its second-quarter fiscal report last week. In it, Nucor raked in total revenue of $8.79 billion for the quarter, marking a 103% year-over-year surge. Over the same time, the company also saw massive jumps of 1,283% in net income and 1,300% in earnings per share. Following this solid quarter, the company appears optimistic about its current momentum. Specifically, CEO Leon Topalian said that Nucor expects to “set a new record for quarterly earnings” in the current quarter as well.
Adding to all that, Nucor is also looking to acquire Hannibal Industries, a national provider of racking solutions to warehouses. Through the $370 million agreement, Nucor would be expanding its current warehouse facilities significantly. With the company looking to broaden its operations as well, could NUE stock be a top buy for you now?
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Vulcan Materials Company
Another company that could benefit from the current infrastructure bill would be the Vulcan Materials Company. In short, Vulcan is a major producer of construction aggregates in the market today. The likes of which range from crushed stone and sand to even gravel. Moreover, the company also produces aggregates-based construction materials such as asphalt and ready-mixed concrete. Similar to our previous entry, the potential rising demand for Vulcan’s wares could put VMC stock in the spotlight now. Evidently, the company’s shares are currently up by over 110% since its pandemic era low. Would it be wise to bet on VMC stock’s current prospects?
If anything, the company continues to expand its portfolio even throughout these challenging operating conditions. As of last month, Vulcan is now in the process of acquiring U.S. Concrete (NASDAQ: USCR). Similar to Vulcan, U.S. Concrete is a leading supplier of aggregates and concrete for the infrastructure, residential, and commercial construction projects market. In theory, this acquisition will synergize well with Vulcan’s current portfolio while significantly expanding its geographic footprint. With U.S. Concrete boasting massive operations across California, Texas, and Northeast U.S., this would be probable.
Furthermore, Vulcan reported solid figures in its latest quarter fiscal posted back in May. In it, the company posted total revenue of $1.07 billion for the quarter. On top of that, Vulcan also posted sizable year-over-year increases of 166% in both net income and earnings per share. Not to mention, the company also ended the quarter with over $722 million in cash on hand, a staggering 500% year-over-year jump. With all this in mind, will you be adding VMC stock to your portfolio?
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Caterpillar Inc.
Following that, we have Caterpillar Inc. The construction and machinery company would be another viable play on the infrastructure stock trade now. By and large, this would be thanks to the company being the largest construction equipment manufacturer globally. For a sense of scale, the company posted total sales and revenue of $41.7 billion in 2020. Now, with CAT stock mostly trading sideways in the past month, could investors be looking at a good buying opportunity?
Well, for one thing, we could look at the company’s latest quarter fiscal to get a clearer understanding of this. Back in April, Caterpillar saw green across the board in its first-quarter earnings results. Namely, it reported earnings per share of $2.77 on revenue of $11.89 billion. This added up to year-over-year increases of 40% and 11% respectively. CEO Jim Umpleby cited improving end-market conditions, strong global team performance, and proactive supply chain risk management as key factors for the solid quarter.
All in all, with Caterpillar seemingly eager to pick up the pace on the operational front, CAT stock could be worth watching now. Additionally, the company is also set to release its second-quarter fiscal report tomorrow before the opening bell. Notably, Wall Street’s current estimates point towards an earning per share of $2.38 for the company. This would indicate a potential year-over-year increase of over 130%. All things considered, would you consider CAT stock worth buying at its current price point?
