67 WALL STREET, New York - April 17, 2013 - The Wall Street Transcript has just published its Building Materials, Construction and Housing Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs and Equity Analysts. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.
Topics covered: North American Electrical Transmission, Infrastructure Build in Emerging Markets, Strong End Markets for Building Products, Energy infrastructure companies, Infrastructure spending
Companies include: Steel Dynamics Inc. (STLD), Nucor Corporation (NUE), United States Steel Corp. (X), BP plc (BP) and many more.
In the following excerpt from the Building Materials, Construction and Housing Report, an expert analyst discusses the outlook for the sector for investors:
TWST: What are the broad themes you are seeing in terms of steel?
Mr. Gershuni: We are seeing some domestic themes and global themes. In terms of the United States, things are continuing to strengthen; we are definitely seeing improvements across the board. One of our views is that nonresidential construction is positioned to start to pick up. We have collected together our steel-intensive leading indicators, and we see steel demand continuing to march forward. We look at the indicators like industrial production, building permits, ISM, factory orders - all of them have leading characteristics for steel demand in the U.S., and they are all continuing to point to higher demand.
Right now, as I said, a lot of people are focused on nonresidential construction. There is definitely a relationship when you look at building permits and building permits for five-plus units, which we like to call multifamily units, or larger projects that are more steel-intensive. When you look at the data, you see that industrial production is up month over month, quarter over quarter, year over year. The same trend is taking place with building permits; it's up 7.5% month over month, quarter over quarter 4% versus last year's numbers.
In fact, it's 55% higher than last year, which is obviously significant. In terms of overall permits, you are seeing a similar trend, 4.6% month over month, 5% quarter over quarter, 3% year over year. It's continuing to build, which is the same trend we are seeing with the ISM. The only negative spot we have seen really recently is in factory orders, which are down month over month 2%, quarter over quarter 1%. But the year-over-year number is still actually up as well.
When you take all of that together, each one of these basically foreshadows future steel demand, and it is even a stronger trend when you take them together, so what we're basically seeing is a broad pickup. The area where there has been weakness is...
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