Do You Have These Top Infrastructure Stocks On Your Watchlist Right Now?
As we end this week of trading, infrastructure stocks appear to be the name of the game in the stock market now. Namely, news of President Biden coming to an agreement with Republican Senators on an infrastructure package for the country would explain this. Yesterday, the President confirmed that both sides have indeed “struck a deal” with $579 billion in funds set to bolster U.S. infrastructure across the board. As a result, the move is estimated to create millions of jobs for Americans but also an opportunity for eagle-eyed investors.
Now, understandably, the current infrastructure plan will see significant funds being channeled towards bolstering physical infrastructure. The likes of which include the power grid, public transportation, high-speed internet access in rural areas, and water pipes. If anything, this would highlight numerous industrial stocks now. Companies such as Nucor (NYSE: NUE) and Freeport-McMoRan would be vital as they provide raw construction materials. At the same time, the likes of John Deere (NYSE: DE) would serve to provide the necessary equipment to carry out heavy-duty work as well. By and large, the current deal serves to boost the current reopening trade tailwinds seen by infrastructure stocks now. All three of these companies’ shares are already looking at gains of over 120% in the past year.
Not to mention, there is also room in President Biden’s budget for the increasingly relevant electric vehicle (EV) industry. Specifically, $15 billion in funds will go towards EV infrastructure such as charging stations. This would put companies such as Blink Charging (NASDAQ: BLNK) in the spotlight now. As you can see, there are plenty of entry points into the hot infrastructure market now. On that note, here are three worth knowing in the stock market today.
Top Infrastructure Stocks To Buy [Or Sell] Now
- United Rentals Inc. (NYSE: URI)
- Caterpillar Inc. (NYSE: CAT)
- ChargePoint Holdings Inc. (NYSE: CHPT)
United Rentals Inc.
Starting us off today is United Rentals Inc. (URI). In brief, it is the world’s largest equipment rental company thanks to its massive rental fleet of about 660,000 units. The likes of which total about $13.49 billion in original equipment cost, according to URI. Moreover, URI also boasts a huge integrated network consisting of 1,167 rental locations across the U.S. Canada, and Europe. With the eventual uptick in construction projects now, URI’s services would be in demand. Likewise, demand for URI stock could also be up amongst investors now. With gains of over 115% in the past year, would it have more room to run this year?
Well, for one thing, Citi (NYSE: C) analyst Timothy Thein seems to believe so. Earlier this week, Thein hit URI stock with a Buy rating and maintained a price target of $350. The analyst cited strength in the construction and industrial markets as well as tight rental markets as possible growth drivers. Meanwhile, URI does not seem to be sitting idly by as well. Last month, the company acquired General Finance Corporation, a leading specialty rental services company. Specifically, General Finance offers portable storage, modular space, and liquid containment solutions. According to CEO Matthew Flannery, this would greatly expand URI’s growth capacity.
If that wasn’t enough, URI also appears optimistic about the current fiscal year ahead. In its latest quarter fiscal posted in April, the company raked in earnings per share of $2.80 on revenue of $2.057 billion. Because of this, the company is raising its full-year guidance citing stronger growth in its core businesses. Given all of this, would you consider URI stock a top infrastructure stock to invest in now?
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Caterpillar Inc.
Another key name to know in the infrastructure trade now would be Caterpillar Inc. In short, Caterpillar is the world’s leading manufacturer of construction and mining equipment. Aside from that, the company also produces diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives. Supporting its massive portfolio would be Caterpillar’s global dealer network. The likes of which are present on every continent worldwide. Given the relevance of Caterpillar’s wares in both the construction and mining industries, investors could be watching CAT stock now. Evidently, the company’s shares are already up by over 125% since its pandemic-era low.
For the most part, business appears to be good for Caterpillar now. In its first-quarter fiscal posted back in April, the company saw green across the board. To begin with, Caterpillar posted total revenue of $11.9 billion for the quarter. Additionally, the company saw sizable year-over-year jumps of 40% in net income and 39% in earnings per share. This was also followed by a 67% increase in cash on hand over the same time. CEO Jim Umpleby highlights improving conditions in Caterpillar’s end markets as an encouraging sign for the company. By proactively managing supply chain risks, Umpleby believes that Caterpillar can continue to strive for long-term profitable growth.
Supporting this current trajectory, the company also recently increased its quarterly cash dividend. Earlier this month, the board of directors at Caterpillar voted towards an 8% dividend raise, totaling $1.11 per share. With a strong balance sheet and positive industry tailwinds backing it, would you consider CAT stock a buy?
[Read More] Best Dividend Stocks To Buy Today? 3 To Watch Before July 2021
ChargePoint Holdings Inc.
Next up, we have ChargePoint Holdings Inc., a leading player in the EV infrastructure industry. The California-based company operates one of the largest networks of independently-owned EV charging stations globally. In terms of scale, ChargePoint’s stations are present across 14 countries today. Arguably, CHPT stock offers investors a means to bet on both EV trends and infrastructure stocks at the same time. Even now, the company’s shares appear to be on investors’ radars. This can be seen as CHPT stock is currently up by over 35% in the past month.
Regardless, Needham analyst Vikram Bagri recently hit CHPT stock with a Buy rating and $39 price target. This would indicate a potential upside of 22% over its closing price of $31.91 as of Thursday’s closing bell. Bagri argues that ChargePoint’s “capital-light model” of merely providing the necessary hardware and software for EV charging units is a sound one. So much so, that the analyst expects ChargePoint to increase revenue at a compound annual growth rate of 49%. He also mentions that this would be on the conservative end as EV adoption could potentially ramp up faster than expected.
While institutional investors seem to be bullish on CHPT stock, ChargePoint continues to expand its services. As of last week, the company is currently collaborating with luxury automotive manufacturer, Mercedes. The duo will be launching the “Mercedes me Charge” service together with the all-new Mercedes-EQ all-electric luxury sedan. According to ChargePoint, Mercedes me Charge account holders will have access to the largest charging point network in North America. In detail, the company currently operates via 60,000 charging stations, with plans to double this figure moving forward. With ChargePoint firing on all cylinders now, will you be adding CHPT stock to your portfolio?
