NEW YORK ( TheStreet) -- The construction sector is up 85.3% year to date, led by the homebuilders. But even with this strong performance, the sector is still 8.5% undervalued. Reporting this week are three stocks of interest in this sector. This morning, engineering firm Shaw Group ( SHAW) reported a narrower-than-expected fiscal third-quarter loss and set a $500 million share-buyback program. A leading supplier of construction materials, Texas Industries ( TXI), reports after the close on Wednesday. And on Thursday pre-market, seller of industrial and construction supplies Fastenal Co. ( FAST) joins the earnings parade. If you assume the housing market has bottomed, then the companies that supply engineering, materials and supplies should also perform well. If not, then you would have to assume that the homebuilders rallied too far, too fast. Only one of the stocks I profile today has a buy rating from ValueEngine, while the other two are rated hold. Even so, investors interested in these companies can employ my "buy-and-trade" strategy. Shaw Group's stock is rated a Hold (3-Engine), according to ValuEngine, with a one-year price target at $29.55. SHAW stock has not had great performance, with a 12-month return of only 0.2% and a five-year average annual loss of 12.6%. The price-to-earnings ratio is reasonable at 10.7 times 12-month forward earnings estimates. The daily chart shows that SHAW has rising momentum and is above its 21-day, 50-day and 200-day simple moving averages at $26.67, $27.14 and $26.66, respectively. My quarterly value level is $25.42 with a monthly risky level at $32.25. Shaw Group, headquartered in Baton Rouge, La., is an engineering, construction, technology, fabrication, environmental and industrial services company with offices in North America, South America, Europe, the Middle East and the Asia-Pacific region. Texas Industries, a supplier of cement and steel materials, is expected to report a loss of 34 cents a share after the close on Wednesday. The stock has been upgraded to Hold (3-Engine) from Sell (2-Engine) this morning, according to ValuEngine, with a one-year price target at $39.30. TXI has had a strong stock with a 35% price rise since June 4. The stock has a 12-month return of just 2.1% with an average annual loss of 13% over the past five years. ValuEngine does not have the P/E ratio for this stock. The daily chart shows that TXI has overbought momentum and is well above its 21-day, 50-day and 200-day simple moving averages at $36.25, $34.21 and $32.46, respectively. My monthly value level is $36.63 with quarterly risky level at $45.95.