How Do I Invest in Infrastructure Stocks?

To a large extent, communication lines and many kinds of utility infrastructure (like power lines) have been owned privately by the telecommunication companies (or "telcos") and the utilities that service them. For example, your cable TV system is an element of infrastructure, and your cable company owns those lines of content delivery. The move toward private investment into public-use infrastructure such as the highway system is helping the infrastructure realm grow at an impressive clip.

Infrastructure lends itself to nice, steady returns over the long haul. When you invest in infrastructure, you're investing in a long term, fixed asset . And it's that underlying concrete asset that makes infrastructure investments look very attractive.

In a recent BusinessWeek article, James Holloway pointed out that "infrastructure assets are long-lived, with bond -like characteristics; namely, stable cash flows linked to inflation ." He also noted that competition isn't much of a concern for infrastructure companies. All told, infrastructure's benefits are pretty compelling.

Which Companies Deal With Infrastructure?

There are a few heavy hitters in the infrastructure business. These include Macquarie Infrastructure Company (MIC Quote), an operator whose infrastructure trust is listed domestically; heavy construction contractors and equipment manufacturers like Caterpillar (CAT Quote), Deere (DE Quote), and Chicago Bridge & Iron (CBI Quote); and, of course, materials and engineering firms like Cemex (CX Quote) and WillDan Group (WLDN Quote).

The majority of these companies' connections to infrastructure are based on a couple of things (read on). However, operators like Macquarie own (or lease in many cases) those really long term assets that are associated with infrastructure.