For owners of construction stocks, the fallout of the subprime lending crisis has hit home in a big way. With prospective homeowners finding it difficult to obtain credit, this is not a good time to be in the process of selling new homes. Business construction has slowed too, as more companies are cutting back instead of adding to their existing facilities. Even in the worst of times, however, there are always companies still able to weather the storm. Here are four construction stocks whose strong performance will help build your portfolio:
Companies Benefiting from Cold War Weapons Cleanup
On April 22nd, the U.S. Energy Departmentannounced that it will spend $6 billion to clean up nuclear weapons facilities dating back to the Cold-War era. This endeavor is part of Barrack Obama’s stimulus package, and more than half of the money is going toward clean up in South Carolina and Washington. In total, twelve states will receive funding to clean up nuclear and other hazardous waste left behind from the Cold War. This plan has the potential to be a lucrative opportunity for investors as there are only a handful of companies who specialize in hazardous waste clean up. These companies include American Ecology (ECOL), Clean Harbors (CLH), and Perma-Fix Environmental Services (PESI).
Companies Standing to Benefit from the Swine Flu Outbreak
We live in an age and environment when, no matter what threat we face, there are organizations that stand to benefit. The current swine flu outbreak (more scientifically known as H1N1) is no exception. Several large international companies are well placed to gain from what is now being referred to as a pandemic. The two essentials in combating this flu will undoubtedly be diagnostics and treatment via antiviral drugs and vaccines.
Investing In Auto Repair Companies
The global economic downturn has had devastating effects car manufacturers as consumers worldwide have put off buying new vehicles and have chosen to keep and maintain their current ones. While this has severely affected the likes of General Motors (GM), Ford (F), and Toyota (TM), it provides unprecedented opportunities for auto parts stores, parts suppliers, and auto repair specialists.
Companies Benefiting from Capping Green House Gases
The Obama Administration has proposed a program to limit greenhouse gas emissions. Under a “cap and trade” scenario, companies exceeding the set limits could purchase and emission allowances on the open market. Republican detractors label the proposal a veiled tax on business, and predict job losses and further damage to the economy. The Environmental Defense Fund, however, found 1,200 companies in 12 states that would benefit from a carbon cap program resulting in the creation of approximately 5 million “green” jobs.
Companies Benefiting from Obama’s High-Speed Rail
High-speed rail development is a growing industry worldwide, and President Barack Obama recently committed $13 billion in seed money to the United States’ foray into this hot market. If the federal government follows through with visionary plans for a cross-country high-speed rail system, U.S. companies that specialize in railway equipment, technology and vehicles could get a boost in business for years to come.
Which Companies Benefit from Nationwide High-Speed Internet?
The Federal Communications Commission, with the support of the Obama administration, has made a commitment to make high-speed, broadband Internet affordable and available to everyone. This initiative is part of the Obama administrations’ plan to help spur economic growth by creating jobs and encouraging innovation. The companies who are most likely to benefit from the implementation of this plan are AT&T Inc. (T), Verizon Communications (VZ), Windstream Corp. (WIN), and General Cable Corp. (BGC).
Who Benefits from Life Insurance Company Bailouts?
The Treasury Department recently announced that it has decided to extend federal bailout eligibility to struggling life insurance companies. Treasury officials are reviewing applications from about a dozen large insurance companies seeking a share of what is left of the Trouble Asset Relief Program (TARP) after the financial and auto industry bailouts. The insurance companies play an important part in US finance and their collapse poses a huge risk to the financial system. The life insurance industry is one of the largest investors in the corporate bond market, holding approximately 18 percent of all US corporate bonds. They also have large stakes in commercial real estate and government bonds. Some of the companies expected to benefit from this bailout include Hartford Financial Services Group (HIG), Lincoln National Corporation (LNC), Prudential Financial (PRU) and MetLife (MET).
Who Benefits from FASB Accounting-rule Changes?
The Financial Accounting Standards Board’s (FASB) mark-to-market rule requires firms to report the fair-market value of their assets on a quarterly basis. The valuation is based on the sales price fair market price of equivalent assets. Opponents of mark-to-market contend that in illiquid markets, mark-to-market unduly penalizes companies by making them write-down their assets, thereby exposing them to more financial risks as a result of the unfavorable valuations that result from the ensuing depressed prices. Proponents on the other hand believe that the fair market price is a true reflection of the value of the asset at the time.
Who Benefits if GM and Chrysler Go Bankrupt?
The fears of an imminent bankruptcy for both General Motors (GM) and Chrysler are already having effects on their sales numbers. In March, Chrysler experienced a 39% decline in sales, GM experienced a 45% decline in sales and Ford Motors (F) experienced a 41% decline in sales. Overall, the number of units sold currently stands at 9.86 million units on an annualized basis. This pales in comparison to the yearly average of 16.8 million units sold in the last decade.