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A New $1T US Infrastructure Bill on the Way? ETF & Stock Picks

·3 min read

The Trump administration is reportedly preparing a nearly $1 trillion infrastructure proposal as part of its efforts to bolster the American economy. The Department of Transportation's preliminary version takes care of most of the funding for projects such as roads and bridges, but also kept money for 5G wireless infrastructure and rural broadband.

The present U.S. infrastructure funding law, known as the FAST Act, permits $305 billion over five years. The limit expires on Sep 30. Lawmakers will either extend it or bring about with it a long-term replacement. The White House, which has made similar proposals in recent years, is aiming to unveil its latest effort in July, per one of the sources. News of the likely increment in stimulus was first reported by Bloomberg.

The new authorization will likely be for 10 more years. If enacted, this would be the longest-ever surface transportation bill. The White House is reportedly set to release its proposal as early as next week. The full House is expected to vote on the proposal in early July. The new bill is in line with Trump’s 2016 campaign pledge.

U.S. equities have benefited since the release of the news. However, the direct beneficiaries of the move will likely be the below-mentioned ETFs and stocks (read: Don't "Bet Against the American Economy:" ETF Areas to Win).

ETF Picks

iShares U.S. Infrastructure ETF (IFRA)

The fund offers exposure to U.S. infrastructure companies that could benefit from a potential increase in domestic infrastructure activities. The 135-stock fund charges 40 bps in fees.

Invesco Dynamic Building & Construction ETF (PKB)

The underlying Dynamic Building & Construction Intellidex Index comprises stocks of U.S. building and construction companies. The fund charges 60 bps in fees.

ProShares DJ Brookfield Global Infrastructure ETF (TOLZ)

The fund offers access to an asset class with growing global demand, increasing opportunities for private investment, and high barriers to entry that limit competition. The United States accounts for about 51% of the 123-stock fund. The fund charges 46 bps in fees.

Stock Picks

Vulcan Materials Co (VMC)

The Zacks Rank #3 (Hold) company is engaged in the production, distribution and sale of construction aggregates and other construction materials in the United States and Mexico.It comes from the Building Products - Concrete and Aggregates industry which has a favorable Zacks industry rank (placed at the top 16% of total 250+ industries in the Zacks universe).

Summit Materials Inc (SUM)

It is a construction material company. The company supplies aggregates, cement, ready-mix concrete and asphalt primarily in the United States and western Canada. It has a Zacks Rank #3.It too comes from Building Products - Concrete and Aggregates.

Granite Construction Inc (GVA)

The Zacks Rank #3 company is one of the nation's largest infrastructure contractors and construction materials producers. It belongs to the Building Products - Heavy Construction industry, which has a favorable Zacks Rank (top 38%).

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Vulcan Materials Company (VMC) : Free Stock Analysis Report
 
Granite Construction Incorporated (GVA) : Free Stock Analysis Report
 
Summit Materials, Inc. (SUM) : Free Stock Analysis Report
 
Invesco Dynamic Building Construction ETF (PKB): ETF Research Reports
 
ProShares DJ Brookfield Global Infrastructure ETF (TOLZ): ETF Research Reports
 
iShares U.S. Infrastructure ETF (IFRA): ETF Research Reports
 
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