Around a construction site, a certain kind of optimism takes hold. It can be seen in the way orange cones are lined up before sunrise, in the backhoe’s diesel idle while it waits for a permit, and in the way workers gather with coffee at 6:30 a.m. to discuss the next section of the highway. There are more of those scenes in America now than there have been in years, and behind each one is a contract that stems from a piece of legislation that hardly anyone outside of Washington ever reads.
Late in 2021, the Infrastructure Investment and Jobs Act was passed. Of its $1.2 trillion, only between $400 and $450 billion had been announced or awarded by early 2025. The majority of retail investors overlook that aspect. The money is still slowly making its way through, much like thick syrup slides down the side of a glass, even though the headlines moved on years ago. There’s a feeling that actual spending is only now beginning. When you include the CHIPS Act and the Inflation Reduction Act, you can see nearly $1 trillion in committed funds eventually translating into backlogs at manufacturing companies.
The part to keep an eye on is backlogs. Earlier this year, the telecom and fiber specialist Dycom reported its largest backlog to date. The company’s management candidly described the situation as the beginning of a generational deployment of digital infrastructure. Hyperscaler-driven data center buildouts are only starting to pick up steam into 2026, according to trade publications, and the stock has increased by about 100% so far this year. Execution determines whether the run continues. How much of that demand has already been priced in is still unknown.
In contrast, the materials side seems almost antiquated. The companies that extract the rock and pour the concrete are Vulcan Materials, Martin Marietta, and CRH. Their tales are not glamorous. However, someone’s aggregates are used for every mile of repaired highway in Pennsylvania, every reinforced bridge in Louisiana, and every expansion of an airport apron in Phoenix. There is a reason Vulcan trades at a premium, and analysts continue to find ways to defend it even at that valuation. That argument has a stubbornness that I find strangely compelling.
This cycle, the financing layer underneath is subtly different. The infrastructure stories from the 2011 era did not foresee the ways in which private capital has supplemented federal funds. Transmission lines, water systems, and grid hardening are being financed by pension funds, sovereign wealth, and infrastructure-focused private equity with appetites that did not exist ten years ago. As this develops, it’s difficult to avoid the impression that the public-private hybrid is the real story here, with the equity beneficiaries coming later.
Among institutional investors, the grid itself is now the most talked-about subsector. At the heart of that discussion are Quanta Services and MasTec, who are both putting transmission projects together that utilities have been delaying for years. The crucial specialty positions are discreetly filled by EMCOR and Sterling Infrastructure. Jacobs Solutions ultimately touches almost everything because of its program-management stance. These names are not well-known. That might be precisely the point.
The obvious task of pricing enthusiastically has been completed by the PAVE ETF, which has returned 36% over the last year. Durability is the more difficult question. Congress will need to take action when the Highway Trust Fund expires in September 2026. They most likely will—infrastructure is still one of the few areas where bipartisan instinct endures—but how that reauthorization is structured will dictate which backlogs continue to grow and which begin to decline. It appears that investors think the boom will continue. While drinking coffee in the dim light, the construction workers primarily hope that the work will continue.