Update - November 22, 2022
These Two Companies Are Free-Money Winners
Get ready for more free money…
Late last week, the folks at the White House announced they will be signing some massive checks in the name of upgrading the nation’s electrical infrastructure.
It’s all part of the monstrous infrastructure bill signed into law by Congress earlier this year. This latest piece of funding, under the guise of the “Building a Better Grid Initiative,” is worth $20 billion.
It’s no secret the nation’s power grid is old and failing. Some 70% of what brings juice from where it’s made to where it’s used is more than 25 years old. If we want to get to the “green” future that so many folks are promising, that must change.
As you know, we’ve been preparing for it.
We’ve got a couple of plays in our model portfolio lined up to take advantage of this massive government spending.
The first is KBR (KBR). We’ve already doubled our money on it.
The company has long been a leader in everything related to big infrastructure and, especially, in alternatives to the current system.
For example, it recently inked a deal with massive engine maker Cummins (CMI) to work on creating an industrial supply of ammonia made from renewable sources. It’s a big step toward making hydrogen a larger source of our energy.
For the many folks looking for a way to play the hydrogen market, KBR is an excellent choice. So is Cummins.
Quanta Services (PWR) is a purer play on the current electrical grid and Washington’s near-term spending. Because Quanta strings together so many of the nation’s high-power electric lines, it’s like investing directly into all that infrastructure cash.
What’s most interesting is the company’s somewhat recent (but major) acquisition of engineering giant Blattner Energy. It’s a leader in bringing alternative energy installations to life.
As an analyst at Stifel recently said, the acquisition puts Quanta at the “nexus” of this energy transition. With Washington’s goal of not just upgrading the nation’s aging equipment but also expanding the grid by another 60% over the next seven years, we can see just how lucrative the idea should be.
We’re up nearly double digits on this conservative play, and we got in only late this summer.
There’s more room to run.
The government is spending. These companies are getting ready to catch all that free money.
Make sure you own them.