By: Dividend Sensei
Analysts and economists expect the largest infrastructure package in history to pass this year, up to $4 trillion in size.
Moody’s estimates that even factoring in higher taxes, the economy will grow 1% faster through 2031.
Bank of America estimates this could drive 3% to 4% faster earnings growth in this decade and help boost annual market returns by about 40%.
Industrials are the single most economically sensitive sector, and their earnings (without infrastructure) are expected to soar 173% in 2021 and 2022. If we pass huge infrastructure bills, that growth could be even higher.
8 blue-chips represent the highest quality industrials trading at reasonable to attractive valuations. Analysts think they could deliver 162% total returns over the next five years, potentially beating the S&P 500 by 4x.