With $7.4T needed for U.S. infrastructure, stocks like Ferrovial, Eaton, and Caterpillar are key 2025 opportunities.
Sectors & Industries
May 12, 2025
Table of Contents
With the American Society of Civil Engineers projecting a need for $7.4 trillion in infrastructure investment over the next decade, the sector is set to undergo significant growth. This presents a unique opportunity for investors to benefit from the companies poised to lead these developments.
Every aspect of modern life depends on reliable infrastructure—from transportation systems like highways and airports to utilities ensuring access to clean water and stable electricity. With the shift towards sustainable energy and the increased demand from AI data centers, the need for enhanced infrastructure is more critical than ever.
Infrastructure companies provide essential services that remain in demand, regardless of economic conditions, offering a buffer against market volatility. The steady dividends and stable revenue streams make these stocks appealing to risk-averse investors.
Sector Focus: Highways, Airports, Energy
Ferrovial is a global leader in the design, construction, management, and operation of infrastructure, particularly focusing on transportation and energy sectors. Its operations extend across North America and Europe, with a significant presence in developing and managing toll roads and airports.
Recent Achievements: Recently, Ferrovial has expanded its energy infrastructure capabilities, particularly in renewable energy projects. The company's construction division has successfully completed over 5,400 kilometers of new railway tracks, enhancing regional connectivity. Ferrovial's strategic growth in Texas includes managing several toll roads, reflecting its strong investment in transport infrastructure.
Innovations/New Products: Ferrovial has introduced smart mobility solutions in its highway operations, integrating advanced traffic management systems to enhance road safety and efficiency.
Market Performance:
Sector Focus: Electrical Management
Eaton Corporation is an Irish-American multinational power management company providing solutions that help its customers manage electrical, hydraulic, and mechanical power more efficiently, safely, and sustainably.
Growth Projections: The company expects a 7% to 9% organic growth this year, with significant advancements in green energy technologies.
Recent Developments: Eaton set a fourth-quarter sales record, despite facing disruptions like Hurricane Helene and strikes in the aerospace sector. The company is a pioneer in integrating cyberspace and physical systems within the power grid.
Innovations/New Products: Eaton recently launched a new range of energy-efficient products, including the next-generation of circuit breakers that leverage machine learning to predict maintenance needs and enhance energy consumption efficiency.
Market Performance:
Sector Focus: Equipment Rental
United Rentals is North America’s largest equipment rental company, with an inventory that includes everything from small tools to heavy machinery.
Financial Performance: Achieved record fourth-quarter revenue and earnings, driven by increased demand across all segments.
Recent Developments: The company's acquisition strategy has significantly expanded its fleet and geographic reach, enhancing its market leadership.
Innovations/New Products: United Rentals has recently launched a mobile app that provides digital solutions for fleet management, helping clients track and optimize their equipment usage efficiently.
Market Performance:
Sector Focus: Building Materials
Martin Marietta is a leading supplier of aggregates and heavy building materials, with operations spanning across the United States.
Market Position: As a top producer of aggregates, the company is vital for the construction industry, providing essential materials for infrastructure projects.
Recent Developments: Despite a challenging year, MLM has seen a resurgence in demand linked to infrastructure spending, resulting in a record profit in the fourth quarter.
Innovations/New Products: The company is increasing its investment in recycling construction materials and recently launched a new line of environmentally friendly, low-carbon concrete products to meet evolving market demands.
Market Performance:
Sector Focus: Motion and Control Technologies
Parker-Hannifin is an industrial conglomerate specializing in motion and control technologies used in a wide range of mobile, industrial and aerospace markets.
Strategic Moves: Asset sales have significantly strengthened financials, allowing for debt reduction and reinvestment in core areas.
Recent Developments: Parker-Hannifin is focusing on high-growth areas such as electrification of mobile systems and has seen an increase in orders from renewable energy sectors.
Innovations/New Products: The company recently introduced a new series of electro-hydraulic pumps that are more energy-efficient and offer better performance for industrial machinery.
Investor Insight: Parker-Hannifin's broad portfolio in motion and control tech positions it well for a rebound in industrial demand, despite current headwinds.
Market Performance:
Sector Focus: Communication Infrastructure
American Tower is one of the largest global REITs and a leading independent owner, operator, and developer of multitenant communications real estate.
Strategic Advantage: AMT's extensive portfolio of communication sites is crucial for the expansion of broadband and telecommunications services, especially in rural and underserved areas.
Recent Developments: The company's international expansion, especially in India and Africa, has significantly grown its market footprint.
Innovations/New Products: AMT has been actively involved in the rollout of 5G networks, developing new tower designs that accommodate a broader range of technologies and equipment.
Investor Insight: AMT’s infrastructure is critical for enhancing connectivity, particularly in underserved areas, making it a pivotal player in the telecom sector.
Market Performance:
Sector Focus: Construction and Mining Equipment
Caterpillar is the world’s leading manufacturer of construction and mining equipment, diesel and natural gas engines, industrial turbines, and diesel-electric locomotives.
Market Dynamics: Plays a crucial role in both the construction of new infrastructure and the mining needed for raw materials.
Recent Developments: Despite a downturn in sales, Caterpillar is positioned for growth with increased demand for its advanced machinery geared toward infrastructure renewal and energy sector expansions.
Innovations/New Products: Recently, Caterpillar has launched a new line of hybrid excavators and autonomous vehicles designed to offer higher efficiency and reduce environmental impact in construction and mining operations.
Investor Insight: As the world transitions to sustainable energy sources, CAT’s machinery and equipment are indispensable for both construction projects and natural resource extraction.
Market Performance:
As we move towards a more connected and sustainable future, the companies at the forefront of infrastructure development are not just participating in growth but driving it. For investors, these stocks offer a combination of stability and potential for appreciation, grounded in the ongoing and essential demand for infrastructure enhancement.
Some of the top infrastructure stocks to consider in 2025 include Ferrovial SE, Eaton Corp, United Rentals, Martin Marietta Materials, Parker-Hannifin, American Tower, and Caterpillar. These companies lead in areas like transportation, energy systems, communication infrastructure, and industrial equipment—all sectors experiencing sustained growth due to global infrastructure demand.
Infrastructure companies with strong earnings growth, strategic positioning, and exposure to long-term trends like clean energy and digital connectivity have high potential. Stocks like Eaton (energy efficiency), American Tower (5G infrastructure), and Ferrovial (toll roads and renewable projects) could potentially double in value over the next decade, though actual performance depends on macroeconomic factors and company execution.
Top-rated infrastructure funds include the iShares Global Infrastructure ETF (IGF), Global X U.S. Infrastructure Development ETF (PAVE), and Brookfield Global Listed Infrastructure Fund. These funds provide diversified exposure to global infrastructure companies across utilities, energy, and construction sectors.
Warren Buffett has not publicly endorsed a specific infrastructure fund, but his investment approach emphasizes companies with durable competitive advantages, strong cash flows, and long-term growth potential. Many of the qualities he seeks can be found in infrastructure leaders like Caterpillar and American Tower, which Berkshire Hathaway has held in the past or align with his strategy.
Yes. With governments worldwide increasing infrastructure spending to support economic growth, clean energy transitions, and digital expansion, infrastructure funds are well-positioned. They also offer stability and inflation protection, making them attractive during uncertain market cycles.
Infrastructure stocks are considered relatively safe, income-generating investments. They benefit from long-term contracts, recurring revenue, and inelastic demand for essential services. In periods of inflation or market volatility, infrastructure stocks tend to outperform more cyclical sectors.
Funds like PAVE and UTI Infrastructure Fund (in India) are known for their focused exposure to construction, utilities, and power projects. Investors should evaluate based on the fund’s holdings, expense ratios, and regional exposure to match their investment goals.
As of 2025, one of the largest infrastructure fund-of-funds is Macquarie Global Infrastructure Total Return Fund and Brookfield Super-Core Infrastructure Partners. These offer institutional investors access to a diversified portfolio of infrastructure-focused funds, often with a mix of direct investments and fund allocations.
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