Many industrial stocks, including the ones from construction companies, are normally referred to as slow but steady income stocks. This is because they are more likely to give a return to shareholders than to increase in value over the night. Although there are some firms that pay a dividend, most construction firms can grow at a fast pace due to their long-term exposure to spending trends.
If you are interested in such growth, here are some key standout construction company stocks to choose from:
Caterpillar inc is the producer behind many of the big vehicle names in the world. This firm is the world’s leading producer of mining and construction equipment. It also deals with natural gas and diesel engines, diesel-electric locomotives, and industrial gas turbines.
When there is a huge demand in building, this firm has many ways to win. It sells heavy materials needed for building, and it benefits from the huge demand in raw materials that make mining firms buy new equipment. Caterpillar has a big financing arm and every year, this company generates billions on spare part sales and services:
- Last year, it generated about $51 billion in sales
- It returned about $5 billion to shareholders through share dividends and repurchases and still has a huge profit balance at the end of the year;
- Stock buyers of this firm get a 2% yield in dividends, increasing their profit earnings.
It’s safe to say that Caterpillar is a huge business.
Steel is a common building raw material, and not many firms are efficient in making steel like Nucor does. Since the year 1960, this company has revolutionized the steel-producing industry by replacing the inefficient blast furnaces with blend metals that melts scraps to useful steel bars.
Today, Nucor is one of the world’s largest steel manufacturers and can remain profitable in the stock market. Last year, this firm earned about $6.83 billion in sales. Nucor also paid dividends for 196 straight quarters. Those who invest in its stocks can earn a 1.3% yield and gain profits.
Saint Gobain is a leading French construction firm that deals with the manufacture and sales of construction material. This company operates through different business segments which include building distribution, innovative materials, and construction products. Since 1965, this company has continued to soar higher in Europe and also on an international level.
In 2021, it has a capital profit of 27.4 billion euros, and this was significantly higher than its capital value the year before. Investors can expect a yield increase in dividend and profit earnings.
Many small to mid-sized contractors need enough equipment than what they have at hand when construction is at its peak. United Rentals can solve this problem. This company offers a large inventory of equipment and has a network that covers Europe and North America.
In addition, United Rentals is one of the largest equipment rental firms in North America. It benefits from renting materials and machines to many industries, including construction sectors. Over the last 10 years, this company’s revenue has increased at the rate of 14% and its earnings per share are about 28%.
Vulcan is the US’s largest producer of construction aggregates. These aggregates include crushed gravel, sand, and stone. It also deals with major construction materials like concrete and asphalt. This firm has a network of about 400 aggregate facilities, 240 concrete sites, and 70 asphalt sites in all the United States, giving it a nationwide exposure to construction projects.
Vulcan materials made a profit of $1.37 billion in 2021 and early this year, it raised its dividend, providing a yield of about 0.9% to investors.
Fluor is an old construction company that has been in existence for many years. It offers a wide range of services from project management to design, and also the actual construction project. Buying this firm’s stocks provides an investor with exposure to both domestic and international private and commercial construction projects. Furthermore, Fluor generated about $13 billion in sales in 2021.
This firm focuses on the industrial engineering of businesses. It provides technical and professional consulting advice to businesses and governmental clients. Its services range from code compliance and environmental impact inspection to permit management and civil engineering. The company also helps to manage projects, ensuring that the construction of buildings is done as designed on time.
Although NVS is smaller than the companies on this list, it still has growth stock potential to offer to clients. In up to five years, its revenue has increased to about $707 million, and it is expected to reach the billion mark before the next two years.
All in all, this list contains different construction companies that deal with different things related to the sector. What each of these firms has in common is their exposure to business cycles and commodity prices. It is not easy to predict the future but safe to say that this sector’s future is very bright. If you want to add some stability to your investment portfolio, the construction industry has solid options that can secure a strong foundation for your investment portfolio.