‘Ordinary’ but exceptional: firms leading the US’s infrastructure renaissance

The US’s transformational upgrade of its drainage, power and road networks is a long-term investment opportunity hiding in plain sight. In this podcast, Michael Taylor reveals some of the outstanding companies involved and makes the case that the markets have yet to fully appreciate the advantages working in their favour. Background: Michael Taylor is an investment manager in Baillie Gifford’s US Alpha strategy. In this Disruption Week briefing, he explains why years of neglect coupled with the destructive consequences of wild weather and our insatiable appetite for data-processing power have led the US to embark on a massive renewal of its physical infrastructure. Taylor suggests that many of the companies creating long-term value benefit from supply advantages, which help them defend their commoditised products’ prices. These range from ownership of gravel quarries, which are difficult to get planning permission for, to the use of a gigantic, portable plastic drain-making machine. In addition, Taylor discusses what a second Trump presidency might mean for the sector and why finding standout companies involves travelling off the beaten track. Resources: Disruption Week Building back: the great US infrastructure opportunity Spotting the winners from the great US infrastructure renaissance Companies mentioned include: Advanced Drainage Systems Eaton Comfort Systems USA Martin Marietta NVIDIA Stella-Jones Timecodes: 00:00 Introduction 1:35 Exceptional businesses confronting an exceptional problem 3:20 The US v global infrastructure opportunity 4:35 Donald Trump’s second presidency 6:40 The benefits of patience 7:35 Wild weather 8:45 Investing in Advanced Drainage Systems 11:05 Labour shortages 12:15 Stella-Jones’s wooden telegraph poles 14:05 Tree-spotter specialists 16:15 Martin Marietta’s supply-side advantage 18:55 Recycled aggregates’ limitations 20:15 Finding US infrastructure investments 21:45 Comfort Systems USA and keeping datacentres cool 24:20 “Massive in terms of magnitude of spend and duration”

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