Report uncovers opportunities in Canada’s infrastructure and construction boom

Investment dealer Raymond James today released a report that highlights key investment opportunities stemming from the Canadian infrastructure and construction boom.

The 116-page report provides a detailed analysis of data together with evidence that supports the premise that the gap that exists in infrastructure investment must be closed by both provincial and federal governments.

“We have witnessed many examples of infrastructure shortfalls that have affected several markets across the country,” says Frederic Bastien, Raymond James analyst. “We’ve seen crumbling bridges in Quebec, power outages in Ontario, and enormous highway and light rail transit expansions in Alberta and British Columbia. And this is just a start.”

The report quotes respected industry sources that claim that Canada’s total infrastructure investment gap is now pegged at roughly $125 billion.

“Our analysis points to a huge backlog of activity right across the country,” says Ben Cherniavsky, co-author of the report and a senior Raymond James analyst.

The report details five segments in the construction market which are spurring on the current boom — transportation, buildings, power and utilities, water, and mining — in seven separate regions of the country — British Columbia, Alberta, the Prairies, Ontario, Quebec, the Atlantic provinces and the North.

According to the analysis, there are six key forces causing the current infrastructure and construction boom in Canada. First, there is a general recognition of the urgency to repair or upgrade the nation’s infrastructure; federal and provincial governments are in good financial shape to afford these investments; governments have more effective ways to finance infrastructure projects; strengthening Canada’s infrastructure is good for international trade flows and opportunities related to increased globalization; environmental concerns are causing governments to invest in “green infrastructure” such as wind power, water purification, and light train transit. Finally, the enormous activity in the oil sands and mining is having a profound impact on the country’s infrastructure and construction markets.

The report identifies 17 Canadian public companies that Raymond James analysts believe are poised to benefit materially from these trends. They include:

• Aecon Group;
• Bird Construction Income Fund;
• Canam Group – Churchill Corp.;
• Finning International;
• Genivar Income Fund;
• GLV Inc.;
• IBI Income Fund;
• Lockerbie & Hole;
• McCoy Corporation;
• North American Energy Partners;
• Ritchie Bros.;
• SNC-Lavalin;
• Stantec Inc.;
• Toromont Industries;
• Wajax Income Fund;
• ZCL Composites.