GEO Investing

A few weeks ago, I revisited the infrastructure screen we began to develop back in 2016, a project I hadn’t examined closely for quite some time. Upon looking at the stocks in that screen that as of now show an up-to-date average return of 299.93% (vs. 247.91% as of the previous post)

Infrastructure Screen Current Returns as of 3-3-2024

…I felt it was time to re-evaluate the past inclusions.

Keeping informed on infrastructure stocks opens the door to identifying lucrative growth opportunities that can significantly enhance the value of your investment portfolio. Infrastructure is a foundational sector that often experiences steady growth due to constant demand for construction, maintenance, and upgrades of facilities and services. Aligning a portfolio with these trends ensures the opportunity to benefit from governmental and private sector spending in infrastructure. This approach not only maximizes potentially great returns but also contributes to a diversified and resilient investment portfolio in sectors that often get passed by for sexier themes

Part of this reassessment was to determine which stocks still possess growth potential or if there were any new candidates that could be added to the screen.

By the way, Sterling Infrastructure, Inc. (NASDAQ:STRL) and Ies Holdings, Inc. (NASDAQ:IESC) have both eclipsed the $100 mark, up 41.56% and  42.63% from our opening prices, since the last update, respectively.  Another, Limbach Holdings, Inc. (NASDAQ:LMB) added 28.80%.

This has us really angry. – angry enough to get serious about finding more infrastructure screen candidates.

Interestingly, during our research, we stumbled upon a company that, despite our previous criticisms, now appears to have realigned itself with an innovative vision that caught our attention and where the infrastructure bill has carved out a nice chunk of money for the company’s industry.

This company, with annual revenue of about $12 million, operates within a sector valued at $51.16 billion in 2023 and now projected to grow at a significant compounded annual growth rate (CAGR) of 8.5% from 2023 to 2030. Furthermore, an interdependent market segment is expected to grow at a CAGR of 17.5% during that same period.

What Has Us Excited 

After years of stagnating growth, management has made considerable strides in revamping its software platform that works more comprehensively with its hardware and third party hardware. The software is fed real time data through sensors placed in the hardware to help its customers make decisions to prevent future loss of civilian life due to safety mishaps. 

Of note, management is now very clear in their verbiage that they are viewing the platform to have an AI data analytics focus.

We also uncovered some significant Information Arbitrage commentary from management in a shareholder meeting, that we are confident the market has ignored. You can listen to some relevant commentary from the company’s CEO below (sign in required):

With a price to earnings multiple of about 10x, we see significant upside to the price of the stock once the company proves it can grow consistently. In the meantime, collect a nice dividend, just like we did with Spok Holdings, Inc. (NASDAQ:SPOK).

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Geoinvesting is a research platform founded in 2007 to publish premium research on microcap stocks that meet a certain set of criteria that we have proven leads to superior returns. Empirical evidence proves that investing in microcap stocks beats the returns of larger cap stocks by 8.24% per year. Even Warren Buffett and Peter Lynch have said that if they were to invest in one type of stock, it would be microcaps.

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