S&P 500   5,011.12
DOW   37,775.38
QQQ   423.41
How major US stock indexes fared Thursday, 4/18/2024
CSX Co.: The Railroad Powering Ahead with an Earnings Beat
Shares of Walmart-backed Ibotta soar on public debut
Closing prices for crude oil, gold and other commodities
IMF's Georgieva says there's 'plenty to worry about' despite recovery for many economies
World Bank's Banga wants to make gains in tackling the effects of climate change, poverty and war
Taiwan Semiconductor Earnings: AI Dominance and Future Outlook
S&P 500   5,011.12
DOW   37,775.38
QQQ   423.41
How major US stock indexes fared Thursday, 4/18/2024
CSX Co.: The Railroad Powering Ahead with an Earnings Beat
Shares of Walmart-backed Ibotta soar on public debut
Closing prices for crude oil, gold and other commodities
IMF's Georgieva says there's 'plenty to worry about' despite recovery for many economies
World Bank's Banga wants to make gains in tackling the effects of climate change, poverty and war
Taiwan Semiconductor Earnings: AI Dominance and Future Outlook
S&P 500   5,011.12
DOW   37,775.38
QQQ   423.41
How major US stock indexes fared Thursday, 4/18/2024
CSX Co.: The Railroad Powering Ahead with an Earnings Beat
Shares of Walmart-backed Ibotta soar on public debut
Closing prices for crude oil, gold and other commodities
IMF's Georgieva says there's 'plenty to worry about' despite recovery for many economies
World Bank's Banga wants to make gains in tackling the effects of climate change, poverty and war
Taiwan Semiconductor Earnings: AI Dominance and Future Outlook
S&P 500   5,011.12
DOW   37,775.38
QQQ   423.41
How major US stock indexes fared Thursday, 4/18/2024
CSX Co.: The Railroad Powering Ahead with an Earnings Beat
Shares of Walmart-backed Ibotta soar on public debut
Closing prices for crude oil, gold and other commodities
IMF's Georgieva says there's 'plenty to worry about' despite recovery for many economies
World Bank's Banga wants to make gains in tackling the effects of climate change, poverty and war
Taiwan Semiconductor Earnings: AI Dominance and Future Outlook

This infrastructure construction stock: Is it ready to pop?

Aerial view of the wastewater treatment plant. Round sedimentation tanks. Radial primary pallet. Sediments of treatment facilities like MasTec's properties

Key Points

  • You can see the writing on the wall pointing to what could be coming soon for construction stocks, particularly those enabling the infrastructure and energy industry to build itself out. 
  • Analysts at Goldman see a manufacturing boom, where MasTec stock will likely be called upon to help accommodate rising demand.
  • Analysts know this and are currently screaming at you via their price targets and EPS projections.
  • 5 stocks we like better than NVIDIA

As everyone focuses on technology stocks and artificial intelligence hype, names like Nvidia Corp. NASDAQ: NVDA keep beating expectations and breaking past all-time high prices. You can focus on other underrated spaces of the economy, such as construction stocks.

Stocks like MasTec Inc. NYSE: MTZ can expose your portfolio to subsequent industry potential rallies. It's one of the infrastructure and energy construction names that could soon pop.

Get your edge here 

While markets broke past their charts to bring you fresh all-time high prices, they could be getting ahead of themselves in the cut expectation. Initially believing that the Federal Reserve (the Fed) would act in March, traders are now backing away from that timeline and pricing the move toward May or June of this year.

You can see this live by following the FedWatch tool offered by the CME Group NASDAQ: CME, but what do these cuts mean for the construction industry?


Warren Buffett bought into names like D.R. Horton Inc. NYSE: DHI because most mortgages are held at rates below 3.3%. In comparison, new mortgages hover around 7.4% today.

Homebuyers aren't incentivized to sell their property since they would have to buy another home at a much higher price and financing rate. Likewise, new homebuyers don't particularly want to pay a high mortgage and five-year-high home prices.

Analysts at The Goldman Sachs Group NYSE: GS have expressed their outlooks on the manufacturing sector in the United States, which is nothing short of a boom. Because the ISM Manufacturing PMI index has been contracting for the past year, the Fed cuts can bring the business cycle back into a roaring bull cycle.

Of course, this benefits the expansionary activity in sectors like utilities and energy stocks, which could also be why names like Marathon Oil NYSE: MRO have a 30.4% upside from analyst price targets, landing on $31.2 a share.

Similarly, MasTec analysts see a similar upside of 31.9% in their $94.20 per share targets, something the market is willing to get behind today.

What’s the view? 

MasTec stock trades at a massive discount of 57% of its 52-week high prices, raising some eyebrows about whether it could be a bargain investment today. 

This is particularly interesting when you see other stocks like Caterpillar NYSE: CAT trading at 97% of their 52-week highs, also supporting the infrastructure construction play.

Analysts are shooting for earnings per share at MasTec to grow by as much as 55.6% over the next 12 months, much higher than the industry average of 11.7%. Considering these optimistic growth targets, on top of the discount to previous highs, markets are not shy in letting you know how much they like this deal.

While the rest of the peer group is valued at an average price-to-earnings ratio of 15.9x, you can buy MasTec stock for a much higher 40.3x P/E. The saying "it must be expensive for a reason" applies here, and now you have a better idea of that reason.

It should come as no surprise to you to see how analysts at UBS Group NYSE: UBS upped their price targets on the stock up to $92 per share this month, which could be the first domino to fall in a wave of further analyst upgrades for this rally in the making.

Should you invest $1,000 in NVIDIA right now?

Before you consider NVIDIA, you'll want to hear this.

MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and NVIDIA wasn't on the list.

While NVIDIA currently has a "Moderate Buy" rating among analysts, top-rated analysts believe these five stocks are better buys.

View The Five Stocks Here

12 Stocks Corporate Insiders are Abandoning Cover

If a company's CEO, COO, and CFO were all selling shares of their stock, would you want to know?

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Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
The Goldman Sachs Group (GS)
4.5304 of 5 stars
$403.11-0.2%2.73%15.74Moderate Buy$434.93
MasTec (MTZ)
3.5875 of 5 stars
$83.40+0.7%N/A-126.36Moderate Buy$96.46
UBS Group (UBS)
1.9562 of 5 stars
$28.12+0.0%0.64%3.13Moderate BuyN/A
D.R. Horton (DHI)
4.6977 of 5 stars
$145.91+0.1%0.82%10.50Moderate Buy$154.00
Caterpillar (CAT)
4.6801 of 5 stars
$357.93-0.1%1.45%17.77Hold$307.56
CME Group (CME)
4.5394 of 5 stars
$209.65+0.6%2.19%23.64Hold$215.70
Marathon Oil (MRO)
4.3473 of 5 stars
$27.39-1.0%1.61%10.70Moderate Buy$32.66
NVIDIA (NVDA)
4.8908 of 5 stars
$846.71+0.8%0.02%70.91Moderate Buy$940.30
Compare These Stocks  Add These Stocks to My Watchlist 

Gabriel Osorio-Mazilli

About Gabriel Osorio-Mazilli

  • gosoriomazzilli@gmail.com

Contributing Author

Value Stocks, Asian Markets, Macro Economics

Experience

Gabriel Osorio-Mazilli has been a contributing writer for MarketBeat since 2023.

Areas of Expertise

Value investing, long/short trading, options, emerging markets

Education

CFA Level I candidate; Goldman Sachs corporate training; independent courses

Past Experience

Analyst at Goldman Sachs, associate at Citigroup, senior financial analyst in real estate


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