Shares in Ireland's biggest construction company soar as investors hope it will benefit from Trump's infrastructure plans
Published 09/11/2016 | 10:15
Shares in ireland’s biggest company, building materials giant CRH, have soared nearly 7pc this morning as investors bet that it will be a big beneficiary from Donald Trump’s plan to pump money into America’s infrastructure.
CRH, headed by chief executive Albert Manifold, generates about 60pc of its profits in the United States, and is heavily involved in the supply of materials used for highway and other construction projects.
The company has a market capitalisation of €24.8bn.
In his acceptance speech this morning, Mr Trump said that he would plough money into America’s infrastructure, including its roads, airports and hospitals, and “double” the country’s growth. He claimed that millions of jobs would be created as a result of the infrastructure splurge.
“The numbers are significant should they come to pass,” said Davy Stockbrokers analyst Robert Gardiner in a note this morning. “Trump has talked in terms of spending trillions on US highways and bridges. This compares to the five-year, $305bn FAST Act passed last November, and Clinton’s $500bn stimulus plan.”
“While talk is cheap and funding is a major question mark, we believe that post-election talk of an infrastructure stimulus will now gain more traction,” added Mr Gardiner. “It may be early days to be weighing the pros and cons for the stock, but CRH seems like an obvious beneficiary.”
CRH is the largest producer of asphalt and the third-largest producer of construction aggregates in the United States.
Last year, the company generated revenue of €23.6bn and a pre-tax profit of €1bn.