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Pros and Cons of Infrastructure Investing
With the Democrats in control of the House of Representatives for the next two years a consensus may be reached to fund upgrades in the sorry state of US infrastructure. This issue needs to be addressed but has repeatedly been pushed back due to political fights over attempts to repeal the Affordable Care Act or fund a big wall between the USA and Mexico. Assuming that funding goes through to repairs roads and bridges, water treatment and the power grid, or rail links and airports, what are the pros and cons of infrastructure investing. And, where would the best places be to invest? Here are three different opinions on the subject.
Market Watch has specific suggestions for infrastructure stocks.
The American Society of Civil Engineers gave America’s overall infrastructure a D+ in its last annual infrastructure report card. That’s a nationwide grade, and includes a D+ for wastewater infrastructure and a D+ for energy infrastructure among other categories; rails were graded a B, the only grade above C+ across 16 categories, and zero A grades were awarded.
Assuming that funding goes through, here are five concrete investment suggestions.
Aecom: Construction and engineering focusing on design, financing, and related services, specializing in infrastructure projects
Caterpillar: This company is the world’s largest maker of construction equipment. It designs, manufactures, and sells its equipment through a global network and provides customers with financing and insurance to support sales. This stock is a bellwether of the American and global economy and a sure bet to prosper in an era of increased infrastructure spending.