Pit & Quarry, December 2018
Infrastructure spending will face another funding battle in Congress when the FAST Act expires in 2020 economy Without confidence in the reauthorization of a federal highway bill investors will be increasingly hesitant to make long term investments driven by infrastructure markets While these metrics suggest growth rates may begin to slow investors have already cooled to construction materials stocks Since Jan 1 2018 the Construction Materials Index CMI has dropped by more than 27 percent compared to a 18 percent increase for the Dow Jones and a 10 percent increase for the S P 500 Since the 2016 election and the Trump bump that emerged two years ago CMI stocks have fallen by more than 21 percent Much of the strength in the market can be attributed to improvements in single family residential spending up more than 20 percent over the last three years Investor optimism for the sector has undoubtedly faltered which will likely begin to influence the behavior of public companies in 2019 Underlying investor sentiment is driven by two primary concerns the first of which is macro in nature As described the outlooks for housing and infrastructure spending while stable do not portend meaningful growth improvements The second and potentially more nefarious concern is cost pressure In late October LafargeHolcim increased its sales forecast for 2019 but reduced profit forecasts citing steep cost inflation as the culprit HeidelbergCement reported similar trends in its forecast for the remainder of 2018 While energy costs are the primary Fines Recovery Equipment Doing What We Do Best Building Fines Recovery Equipment High Rate Thickener Dewatering Screen Fractionator Super Cutter Hydro Cyclone Plate Frame Press Vertical Durability Cell Quad Attrition Mill Made in USA Providing Solutions Call 866 616 9351 or Visit www azfab com February 12 14 2019 Indianapolis IN Come See Us at Booth 37108 INDIANA CONVENTION CENTER 32 PIT QUARRY December 2018 pitandquarry com ISTOCK COM HALBERGMAN
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