how to play the infrastructure boom

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Fink Money & Tim Vollans
September 15, 2025

Weā€™re digging for gold today.

Iā€™m gonna teach you something.

Last week I wrote about the infrastructure boom and how Caterpillar was best serviced to play that (and they still are, but letā€™s go deeper).

Instead of re-writing all the reasons to be so bullish on firms that are going to benefit from infrastructure spending, I want to cut to the chase.

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How might we make a basket of stocks that is likely going to benefit from this?

Well, Iā€™ve done the hard graft for you.

Enter, the Fink Infrastructure basket.

We are not getting overly complex here and including a billion stocks.

We are not accountants that are adverse to risk, and do not believe in diversifying too much for the retail investor.

We want gains, and we want gains that are above a benchmark.

So Iā€™ve created a basket for you to look at (I am not suggesting go out and just buy it, JUST TO LOOK! NOT FINANCIAL ADVICE).

Over the past five years, this basket has returned 235%, with a beta of 1.45.

Over the past 5 years, the SPY has returned 118%.

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Let me preface this by saying past performance isnā€™t indicative of future results (šŸ˜‚) but based on some simple data, we can come to a reasonable conclusion about where the future is headed.

But before that, letā€™s dig into the components.

Caterpillar (CAT)

  • Largest global producer of construction and mining equipmentā€¦ a direct beneficiary of infrastructure spending across roads, energy, and utilities.

  • Massive order backlog and unrivaled dealer/service network drive revenue visibility and resilience.

  • Leading the charge in autonomous equipment and digital fleet management, boosting efficiency and modernising construction sites.

United Rentals (URI)

  • Worldā€™s biggest equipment rental companyā€¦ essential for supporting large and small infrastructure projects.

  • Flexible, asset-light business model thrives as contractors prefer renting to owning during demand surges.

  • Strong cash flow, thick margins, and nationwide presence make URI directly indexed to construction volume cycles.

Martin Marietta Materials (MLM)

  • Premier supplier of aggregates, crushed stone, concrete, and asphaltā€”the foundational materials for roads, bridges, and buildings.

  • Demand extremely sensitive to public works and government infrastructure outlays, with volumes set to surge on stimulus spending.

  • Extensive geographic footprint and strategic quarry locations provide competitive advantage and pricing power.

Nucor Corporation (NUE)

  • Leading U.S. steel manufacturer supplying beams, rebar, and plate steel for new construction and repairs.

  • Efficient mini-mill model allows for rapid scaling and cost advantages as infrastructure demand spikes.

  • Key supplier across wind energy, skyscrapers, bridges, and manufacturing plants.

Emerson Electric (EMR)

  • Industrial automation and process control leader powering efficient, connected infrastructure facilities.

  • Provides hardware and software for smart cities, energy grids, and advanced manufacturing.

  • Well-placed to benefit as projects shift towards digitalisation, sustainability, and operational intelligence.

You can construct this basket in TradingView yourself with the following formula (which is market cap weighted): URI0.1216 + NUE0.0514 + CAT0.5514 + ROK0.0784 + EMR*0.1973

Always remember that if you are making a basket, you must find out its market cap so that you can construct the right position sizes to follow the flow of capital (i.e you will want to be overweight the largest stock and then position accordingly elsewhere, rebalancing quarterly or semi-annually).

Now why do we focus on US companies doing things in the US?

Because the US has already committed $1.2tn on infrastructure spending this year.

Thereā€™s a nice analogy for the US I like in this remit and how to think of them in terms of ā€˜why do we always go to the US for our investing conclusions?ā€™

Itā€™s thisā€¦

In the darkest days of the Cold War, American military analysts huddled over grainy satellite images and intercepted technical documents from deep inside the Soviet Union. Among these, they found what appeared to be the blueprints for a revolutionary new fighter jet: a sleek, needle-nosed machine with gigantic engine intakes and wings that seemed impossibly large for supersonic flight.

The documents, hurriedly translated by intelligence officers, spoke of performance parameters never seen before - Mach 3 flight, radical maneuverability, and targeting systems allegedly capable of burning through enemy jamming from half a continent away. Pentagon officials dubbed the project ā€œRed Hawk,ā€ and urgent memos declared it a ā€œpotential strategic game-changer.ā€ Fearful of falling behind, the US accelerated its own FX program, pouring billions into a new fighter designed to not just match, but surpass the Russian threat.

Engineers at Lockheed and McDonnell Douglas called the project ā€œSkyquake.ā€ The resulting jet was a beast: bigger than anything before, with powerful engines, massive wings, state-of-the-art radar, and enough electronic gadgetry to make a battleship jealous. Early test flights broke records, but the Air Force quickly noticed how the designers had engineered with the foreign schematic's absurd requirements: altitude ceilings no pilot would ever reach, fuel tanks so large the plane could cross the Pacific nonstop, and radar so powerful it needed its own generator.

The panic reached fever pitch when, in 1976, a Soviet pilot named Viktor Belenko stole one of these mysterious jets - dubbed the MiG-25 ā€œFoxbatā€ - and landed it in Japan. US engineers were ecstatic: here, at last, was the real enemy aircraft, ready for dissection. They stripped the plane, analysed every bolt, and, to their shock, discovered the truth: the Foxbat was not a dogfighting demon. It was essentially a crude, high-speed interceptor designed to race after American bombers, not outfight agile jets. Its maneuverability was limited, its radar clumsy, and much of its electronic suite was decades behind Western tech. The Soviet ā€œsuperplaneā€ was more brute force than brilliance.

Back at home, the US engineers looked at the Skyquake - a fighter that was now far more advanced and expensive than necessary. The billions spent had produced an overpowered marvel, but the threat it was designed to defeat was never real. Still, lessons had been learned: intelligence could be dangerously misleading, but sometimes the fear it inspired yielded technological leaps that would dominate the skies for years to come.

And so, Skyquake became both cautionary tale and symbol of the Westā€™s determination- born not from enemy mastery, but from a phantom schematic that turned out to be only smoke, mirrors, and Cold War paranoia.

Unreal story.

But this is what the US does.

Trump is fighting a Cold War with China on making America overpowered.

Itā€™s Game Theory.

And this is why we focus on the US, and specifically in this remit, US infrastructure.

Capital flows matter way more than finding the best pick, and in this case, capital flows from the most powerful entity in the world is driving this basket: the US government.

This daily note is only a glimpse of what we talk about every single day in the Fink Community.

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