Build Your Portfolio: Hedge Funds Like These 9 Construction Stocks

James Dennin, Kapitall: Can we expect good news in construction spending when the government starts releasing data again? 

Huzzah! The government shutdown is over. Washingtonians can grumble all they want about reporting for duty after an unrequested, soon to be paid, two week vacation. 

Read more on housing from Kapitall: Chinese Housing Bubble: Will These Stocks Survive if it Bursts

It's probably a good thing that our government workers are back to getting things done, as opposed to just getting their drink on. And the shutdown didn't seem to have a big overall effect on the markets – a noticeable decline, but hardly the apocalyptic scenario some people were forecasting.

However, while that would seem to be good news, part of the reason the markets didn't move much is because the government stopped reporting data on various sectors. Consumer confidence, unemployment claims, construction reports – all of them stopped coming out when the people who make those reports were put on furlough. 

And now, as the government re-opens, Business Insider is reporting that all of those juicy reports are going to come out at once. It's basically going to be like Christmas for statisticians and forecasters alike, especially if any of the reports contain good news. 

Investing ideas

One of those could be the report on construction spending, which analysts at Citigroup (C) expect to have improved through August and the shutdown. Construction spending affects a number of industries tied to the housing sector, from builders to lumber companies to window manufacturers.

We decided to run a broad screen on the housing sector, looking at a universe of about a hundred stocks related to construction and that could benefit from improved spending. 

To narrow down our list, we looked at which of these companies had experienced upswings in  institutional buying. Institutional buying is significant because it tells us which stocks are being purchased by hedge funds, asset managers, mutual funds and the like.

And it's always important to bear in mind who is buying the shares. Some companies and funds are a lot more discriminating than others, so we included the top holders for the 9 construction stocks on our list. 

Click on the interactive chart to view analyst ratings over time.       

Do you see investing opportunities in construction stocks? Use the list below to begin your analysis. 

1. Beazer Homes USA Inc. ( BZH): Designs, builds, and sells single-family and multi-family homes in the United States. Market cap at $459.43M, most recent closing price at $17.81.

Net institutional purchases in the current quarter at 1.7M shares, which represents about 7.97% of the company's float of 21.32M shares.

Major Holders: Brookfield Asset Management (6.73%); Blackstone Group (6.63%).
 

 

2. Standard Pacific Corp. ( SPF): Operates as a diversified builder of single-family attached and detached homes in the United States. Market cap at $2.17B, most recent closing price at $7.76.

Net institutional purchases in the current quarter at 53.4M shares, which represents about 35.89% of the company's float of 148.77M shares.

Major Holders: MatlinPatterson Global Advisers LLC (45.64%); BlackRock Fund Advisors (4.87%).
 

 

3. Weyerhaeuser Co. ( WY): Weyerhaeuser Company, a forest product company, grows and harvests trees, builds homes, and manufactures forest products worldwide. Market cap at $17.37B, most recent closing price at $29.40.

Net institutional purchases in the current quarter at 47.7M shares, which represents about 8.33% of the company's float of 572.59M shares. 

Major Holders: Capital World Investors (9.16%); Price (T.Rowe) Associates Inc (5.50%). 
 

 

4. Layne Christensen Co. ( LAYN): Provides drilling and construction services and related products to the water infrastructure and mineral exploration markets. Market cap at $390.63M, most recent closing price at $19.93.

Net institutional purchases in the current quarter at 1.7M shares, which represents about 9.02% of the company's float of 18.85M shares. 

Major Holders: Van den Berg Management Inc, dba Century Management (11.90%); Gamco Investors Inc (8.83%).
 

 

5. MasTec, Inc. ( MTZ): Engages in the engineering, building, installation, maintenance, and upgrade of energy, communication, and utility infrastructure in North America. Market cap at $2.54B, most recent closing price at $32.66.

Net institutional purchases in the current quarter at 5.1M shares, which represents about 8.47% of the company's float of 60.24M shares.

Major Holders: Frontier Capital Management Company Inc (6.64%); The Vanguard Group (4.34%).
 

 

6. Primoris Services Corporation ( PRIM): Primoris Services Corporation, a specialty contractor and infrastructure company, provides a range of construction, fabrication, maintenance, replacement, water and wastewater, and product engineering services. Market cap at $1.35B, most recent closing price at $25.99.

Net institutional purchases in the current quarter at 2.4M shares, which represents about 6.8% of the company's float of 35.29M shares.

Major Holders: Wells Fargo & Co. (4.18%); Frontier Capital Management Company Inc (3.64%).
 

 

7. Quanex Building Products Corporation ( NX): Provides engineered products and aluminum sheet products. Market cap at $663.59M, most recent closing price at $18.01.

Net institutional purchases in the current quarter at 2.6M shares, which represents about 8.1% of the company's float of 32.08M shares.

Major Holders: Odey Asset Management Group Ltd (17.99%); Price (T.Rowe) Associates Inc (9.66%).
 

 

8. PGT, Inc. ( PGTI): Engages in the manufacture and sale of windows and doors. Market cap at $456.66M, most recent closing price at $9.94.

Net institutional purchases in the current quarter at 11.9M shares, which represents about 32.86% of the company's float of 36.21M shares.

Major Holders: Eagle Asset Management, Inc. (3.46%); RK Capital Management, LLC (3.21%). 
 

 

9. US Concrete Inc. ( USCR): Engages in the production and sale of ready-mixed concrete, precast concrete products, and concrete-related products for use in commercial, residential, and public works construction projects in the United States. Market cap at $264.18M, most recent closing price at $20.35.

Net institutional purchases in the current quarter at 526.2K shares, which represents about 6.37% of the company's float of 8.26M shares.

Major Holders: Mackay-Shields LLC (9.75%); JP Morgan Chase & Company (7.09%). 
 

 

 

( List compiled by James Dennin, a Kapitall Writer. Analyst ratings sourced from Zacks Investment Research, institutional data sourced from Fidelity, all other data sourced from Finviz.)

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