In Demographics and the Tough Choices Ahead earlier in the week, we made the case that tough choices will need to be made about whether the US labor forces chooses to work on bridges or retail because there simply won’t be enough people to do both.
A few days after our post, a bridge in Pittsburgh collapsed and luckily no one was killed but it won’t be the last bridge to collapse.
To Hota GangaRao, the repeated poor ratings and deterioration of the 52-year-old bridge deck are definite warning signs. Mr. GangaRao, an engineering professor and director of the Constructed Facilities Center at West Virginia University, said a bridge with proper maintenance should last much longer than 50 years.
Pittsburgh Post Gazette
In our earlier post we also promised to review some infrastructure investment opportunities and here is our opinion.
PWR – Qanta Services, While this company has been growing phenomenally well over the past few years and one of our top picks, the stock seems a bit over valued right now. If it dips to the $80s we may pick up some shares.
MTZ – Mastec seems to be poised to grow and perform well if any infrastructure bill is passed and reasonably priced but unfortunately it doesn’t pay a dividend.
DY – Dycom Industries is another stock that seems a bit over valued for our interests but if it drops below $70 it may be another value play but like MTZ it doesn’t pay a dividend.
CMI – Cummins Inc is a bonus stock we came across that while not specifically tied to construction and engineering, the firm does manufacture heavy equipment used in infrastructure and this firm pays a dividend. We will pick up shares of this firm if it dips below $200/share.
Of the four infrastructure plays we researched, PWR was the ideal candidate but, in our opinion, is currently over valued at the moment so we’ll just continue to wait for the right opportunity and may add CMI if it dips below $200.
Stay tuned and stay solvent…