Alright so I'm sure you've heard of Biden's proposed 2.3T American Jobs Plan, fixing and creating vital infrastructure for the US economy while at the same time employing thousands for work. Out of this Bill, there is around 621B allocated for transportation.
Here is a quote from the White House's website about allocation:
"Repair American roads and bridges. One in five miles, or 173,000 total miles, of our highways and major roads are in poor condition, as well as 45,000 bridges. Delays caused by traffic congestion alone cost over $160 billion per year, and motorists are forced to pay over $1,000 every year in wasted time and fuel. The President is proposing a total increase of $115 billion to modernize the bridges, highways, roads, and main streets that are in most critical need of repair. This includes funding to improve air quality, limit greenhouse gas emissions, and reduce congestion. His plan will modernize 20,000 miles of highways, roads, and main streets, not only “fixing them first” but “fixing them right,” with safety, resilience, and all users in mind. It will fix the most economically significant large bridges in the country in need of reconstruction, and it will repair the worst 10,000 smaller bridges, including bridges that provide critical connections to rural and tribal communities. The plan includes $20 billion to improve road safety for all users, including increases to existing safety programs and a new Safe Streets for All program to fund state and local “vision zero” plans and other improvements to reduce crashes and fatalities, especially for cyclists and pedestrians"
This will be the largest infrastructure plan since FDR released the New Deal, nearly 100 years later. 173,000 miles of concrete, 45,000 bridges made of… You guess it, concrete.
With 621B up for grabs thats going into a product that gets manufactured, bought, sold and which companies issue shares for this is a once in a lifetime opportunity to hop on the concrete and cement train.
Now, this still has to get passed through congress. Along side with the American Families Plan, this a MUCH easier sell for republicans. 1.8T for the American Families Plan, 2.3T for the American Jobs Plan to a whopping total of 4.1T in spending. The funny thing is, out of the 4.1T the least contentious part is the 621B for infrastructure. This is actually what republicans want.
Free education for four years? Tough sell.
Direct support to families and children? We'll see
Senior care and wage hikes? Good luck.
Infrastructure to repair roads, bridges and infrastructure using American made products by hiring American workers? SIGN US UP
Even if its less than 621B, say what gets agreed on is 450B, I guarantee you out of anything in the entire two plans, the infrastructure will go through.
How to play this:
Load up on concrete. Firms and funds have already been doing this quietly in the background. Look at $PAVE, the US Infrastructure Development ETF. Since Biden was elected, its been on an escalator ride up. I believe this escalator will turn into an elevator soon enough, especially when the Dems and the Republicans get an appetite for all the sweet sweet gray concrete and black asphalt.
So you can either go the ETF route or hop into individual companies.
Some of the top US Concrete companies:
CX – My favorite
CX is what I'm currently holding, got in around $6.50. I personally think anything under $10 is a steal. I think these are all going to run hot in the next few weeks with chatter around the two bills. Their revenue last quarter beast estimates by over 1000%. You read that right. They are perfectly positioned to take in a big chunk of this government spending. Look what they focus on:
"CEMEX, S.A.B. de C.V., together with its subsidiaries, produces, markets, distributes, and sells cement, ready-mix concrete, aggregates, clinker, and other construction materials worldwide. The company also offers various complementary construction products, including asphalt products; concrete blocks; roof tiles; architectural products; concrete pipes for storm and sanitary sewers applications; and other precast products, such as rail products, concrete floors, box culverts, bridges, drainage basins, barriers, and parking curbs."
That is exactly what we are looking for from a company who will profit over this bill.
I currently have a mixture of shares and options in CX, every time there is a dip I buy more. Including this last week. I wouldnt be surprised if this stock runs up to $15 when the final approval sets.
At the time I wrote this article, CX is trading at $8.34. I don't believe we will ever see another bill this large with the sole purpose of infrastructure. Like I said, Franklin Roosevelt had his Infrastructure Plan approved almost 100 years ago. Don't miss this train.
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