What's In Store For Congress' Next Highway Bill And Which Companies May Benefit
By Morningstar:
By Min Tang-Varner
As construction-related companies wrap up an eventful summer season interrupted by hurricanes, flooding, drought, fire, excessive heat, and other natural disasters, we think the modest demand gains driven by the traditional seasonal uptick may not be enough to alleviate the underlying weak work flows these companies are facing. Overcapacity remains stubbornly high, and we still anticipate some further weakness in the near term. The tepid construction environment has led to a record level of unemployment in the industry and unprecedented belt-tightening across the board during the past couple of years. Although most of the industrial sector in the U.S. economy enjoyed at least a couple quarters of upbeat earnings and expanding margins, the engineering and construction industry and building materials companies have been in solid recession territory throughout the year. One of the most troubling indicators is the perceived deterioration in public infrastructure market conditions. The spreadComplete Story »
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