Construction

Ashtead is out of reasons to stay in London

10 Dec 2024

The $31 bln equipment-rental group plans to shift its main listing to New York. It makes sense since most earnings come from the US. Throw in the prospect of higher CEO pay and President-elect Donald Trump’s America First stance, and the switch looks like a no-brainer.

An $11 bln concrete deal is about unset options

25 Nov 2024

Quikrete is buying building materials peer Summit at a so-so multiple, despite a rush of subsidy-bolstered US construction. If the pace keeps up amid easing interest rates, it’s smart vertical integration. If a new Trump era wrecks that forecast, there are obvious units to sell.

UK’s housing mess requires costly fix

29 Aug 2024

PM Keir Starmer has pledged to build many more houses. Yet homebuilders’ shares are not pricing in a boom. Private players may prefer to sell fewer, pricier properties. More government funds would help, at the risk of further squeezing Britain’s finances.

Latest UK builder M&A may yet have completion date

14 Jun 2024

Crest Nicholson rejected bigger rival Bellway’s $828 mln all-share offer. While Crest’s new profit warning is a turnoff, falling returns mean housebuilder mergers generally make sense. Bellway may not need to offer much more to convince its target’s shareholders.

Suburban sprawl gives insurers the blues

7 Jun 2024

Losses from natural disasters are rising and have exceeded $100 bln for four years in a row. Climate change has made losses from hurricanes grow. But the bigger risk for insurers is severe storms hitting rapidly expanding cities in the sunbelt, like Dallas-Fort Worth.

UK building plans will fail to get off the ground

6 Jun 2024

Rivals in the July 4 election promise 300,000 new houses a year to ease shortages and lower prices. A lack of builders makes that unlikely. More than 346,000 construction jobs have disappeared since 2019. Without immigration or training, Britain will remain cramped and expensive.

CEO pay is hidden factor in US relisting trend

29 May 2024

Plumbing supplier Ferguson almost doubled its boss’s compensation after moving to New York, while $55 bln CRH is reviewing its remuneration after switching too. It’s not something boards like to talk about. But investors might support US-style pay if it attracts the best talent.

Hurricanes threaten to stir perfect economic storm

1 May 2024

Warmer oceans portend an unusually fierce 2024 season in the Atlantic, with two states already propping up their home insurance systems. The nightmare scenario is $200 bln of losses. Insolvencies would be a problem, but not as big as exorbitant premiums and lower property values.

Infrastructure may take toll on big asset managers

14 Feb 2024

Investors have sunk $1 trln in safe, stable assets; BlackRock just made a $13 bln bet on the sector. But success has been spotty and higher rates make investing harder. Plus the definition of infrastructure – which includes laundry and Scandinavian fish farms – is stretching.

Capital Calls: Disney

7 Feb 2024

Concise views on global finance: Boss Bob Iger nabbed Taylor Swift’s movie for his company’s streaming service, took a $1.5 bln stake in Epic Games and shipped more money to shareholders. But traditional TV is declining, and a new sports partnership makes for an awkward fit.

Capital Calls: UK homebuilders

10 Jan 2024

Concise views on global finance: Expectations of mortgage rate cuts helped Persimmon exceed sales targets, giving another lift to its resurgent stock price. The optimism, however, warrants a reality check.

Uncle Sam provides shaky base for Caterpillar

31 Oct 2023

The equipment maker beat third-quarter profit forecasts with help from Washington’s infrastructure bill. Yet half of the $550 bln package has been spent, and Caterpillar’s backlog is shrinking. Like other government-supported spending, federal aid can only help for so long.

Capital Calls: Ford, Amazon

26 Oct 2023

Concise views on global finance: The loss per car at the $45 bln automaker’s electric-vehicle unit has jumped 51% in a year. So-so earnings at the $1.2 trln e-commerce giant’s cloud division beat the even lower bar set by rival Alphabet.

Hostile $7 bln steel war will be forged in fire

14 Aug 2023

Cleveland-Cliffs’ run at 122-year-old metal producer US Steel comes amid a post-Covid slump in the commodity. Strategically and economically it makes sense. But the industry would go from four major producers to three. And the target is, at best, a reluctant participant.

Ukraine can rebuild without a Russian asset grab

30 Jun 2023

Using Moscow’s frozen assets to fund Kyiv’s $400 bln-plus recovery risks violating the rule of law. Suing Russian entities for the damages brought by the war is more promising. It allows Ukraine to build up claims that would be part of future peace talks.

Rebuilding Ukraine depends on luring private money

10 May 2023

International agencies and allied governments are taking care of the war-torn country’s immediate needs. An estimated $400 bln reconstruction bill, however, requires additional investors. Economic incentives and new laws would help attract them even before Russia’s invasion ends.

DR Horton plays ‘heads I win, tails I also win’

20 Apr 2023

Rising cost of funding should be bad for homebuilders, but America’s largest posted stronger than expected earnings. Listings are down 25% from last year as homeowners want to hold on to their cheap mortgages. With scarce inventory, builders benefit from both low and high rates.

CRH’s firm foundations go beyond where it lists

2 Mar 2023

The $38 bln cement maker’s stock rose amid plans to move its primary listing to the U.S. The shift may indeed prompt a re-rating of CRH shares. But the main driver of the latter will be its even greater focus on an infrastructure subsidy-rich market, and on higher-margin work.

Capital Calls: Eli Lilly

1 Mar 2023

Concise views on global finance: The drugmaker is reducing the list price on its insulins by 70%. Problem is, few actually pay anything close to the sticker price. Insurers will probably prefer to use insulins from rivals, assuming they can keep negotiating big discounts.

Capital Calls: UBS fintech U-turn, UK housebuilder

5 Sep 2022

Concise views on global finance: CEO Ralph Hamers cancels the $1.4 bln acquisition of robo-adviser Wealthfront; Countryside Partnerships accepts a 1.3 bln pound offer from UK rival Vistry just three months after rejecting a higher bid.