There has been a lot of talk in the last couple of years about ‘re-shoring,’ that is, rebuilding US industrial and manufacturing capacity. Politically, there is bipartisan support for this, as the economic and national security benefits are clear.
In the aftermath of this month’s election, there is hope that President Trump’s next administration will put a priority on re-shoring US industry. A priority for re-shoring manufacturing, along with other economic capabilities, will bring with it some important ripple effects.
While these are going to be complex, at least one thing is certain: someone is going to have to build new factories, and so the construction industry, and construction stocks, are likely to come out as winners.
There is already movement in this direction. The growth of high-tech, particularly the AI boom, has its own hefty infrastructure needs to build out, including large-scale data centers and their associated power generation facilities. And after several decades of contracting manufacturing, the labor know-how to get these building projects started is at a premium.
Stifel analyst Brian Brophy has highlighted this opportunity, stating: “We are initiating coverage of electrical & mechanical (E&M) engineering & construction (E&C) companies… We see the group as a way to play: 1) secular growth in cloud and AI data centers, 2) on-shoring of manufacturing in the US, and 3) a tight trade labor market.”
Brophy thinks that now is a good time to buy construction stocks – and he is recommending 2 names in particular. We used the TipRanks database to also find out whether other Street analysts are showing confidence in these names too. Let’s check the details.
Everus Construction Group (ECG)
The first stock on our list, ECG, is the newly-public stock of Everus Construction Group, formerly a subsidiary of MDU Resources Group. The spin-off of Everus as an independent public company in its own right was approved on October 2 of this year and completed on November 1. Everus takes control of the parent company’s construction…
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