What are we looking for?
Infrastructure stocks with the potential for gains.
These stocks should, or may have already, benefited from massive stimulus programs started by governments around the world to kick-start their economies.
Benefactors of the new money range from companies involved in everything from building roads and railways to pipelines and energy grids.
The U.S. President Barack Obama's administration, for instance, is poised to spend some $8-billion (U.S.) on high-speed rail projects. And that has players from train makers, construction firms and other companies salivating to get a piece of that financial pie.
Today's screen
We take a look today at the Claymore Global Infrastructure exchange-traded fund. This ETF, which tracks securities in the MFC Global Infrastructure Index, is 43 per cent invested in U.S.-based companies and 21 per cent in Canadian firms.
Canadian holdings representing a 3-per-cent weighting or more in the fund include names like Aecon Group Inc., SNC-Lavalin Group Inc., Enbridge Inc. and TransCanada Corp.
The ETF, which was launched just over year ago at $20 per unit (Canadian), closed up 10 cents yesterday at $16.25 on the Toronto Stock Exchange. The fund has risen 27 per cent from a 52-week low of $11.86 last October.
More about today's screen
Earnings growth for some of the infrastructure stocks are extremely robust. Almost half are in the double-digit range. Price-to-earnings ratios, however, for some companies are still reasonable. In some cases, investors get paid a dividend to wait.
If you are jittery because some pundits are forecasting a correction after the strong runup in North American stocks, you might wait for a pullback. If individual stocks make you nervous, consider the ETF.