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Tickers in this Article: CAT, TEX, MTW, DE, FLR
In December, President-Elect Barrack Obama unveiled an ambitious infrastructure plan that beckons the ghost of Franklin Roosevelt. Obama promised to spend hundreds of billions of dollars (taxpayer dollars, of course) on bolstering shoddy roads, bridges and highways across the U.S., in turn creating tens of thousands of new jobs.

What the Obama plan lacks in originality, it makes up for in opportunity for savvy investors. Infrastructure stocks had been a darling group until the bears took full control of U.S. equity markets earlier this year. Desperate for any bit of good news, the S&P Farm and Machinery Index rose 12% the day the Obama plan was announced. (For further reading, check out Build Your Portfolio With Infrastructure Investments.)

The good news for investors is that there are a plethora of stocks poised to benefit from the next infrastructure boom and the best news may be that these companies won't be dependent on emerging foreign markets to drive growth. They'll be doing some home cooking to increase profits.

Let's look at some of the names that will reap the rewards of new infrastructure boom:

Company Dividend Yield 1-Year Performance
Caterpillar
(NYSE:CAT)
3.9% (36%)
Deere
(NYSE:DE)
2.4% (48%)
Fluor
(NYSE:FLR)
1.1% (29%)
Manitowoc
(NYSE:MTW)
1.0% (80%)
Terex
(NYSE:TEX)
N/A (68%)
As of market close Friday, January 9, 2009.

2008's Losers, 2009's Winners
Manitowoc and Terex are America's largest makers of telescopic mobile cranes and they also share the dubious distinction of being two of the poorest performing stocks in 2008. If rivals are so similar that it is hard to tell them apart, then Manitowoc and Terex are almost identical twins. Unfortunately, so are their stock charts as both show declines of roughly 80% in 2008.

Suggesting this pair of "siblings" is well-positioned to benefit from a rejuvenated infrastructure sector is an understatement. Their cranes and boom trucks will be an integral part of America's infrastructure overhaul, surely becoming ubiquitous once again at construction sites across the country. And their shares may not get much cheaper than they are presently. Both sport market caps of just over $1 billion, an average P/E of just over three and dominant market positions. Of note is Manitowoc's strong cash position, which is about one-third its current market cap. (Read more in Pick Stocks Like Peter Lynch and Cash-22: Is It Bad To Have Too Much Of A Good Thing?)

Commodities or Construction?
Fluor is a quixotic mix of a commodities and construction play. While the company's exposure to the oil and natural gas industries combined with its construction services business to make Fluor a Wall Street darling during the commodities and infrastructure bull markets, its shares have been badly beaten as those sectors fell out of favor. Fluor's stock has barely outperformed the broader market in the past year, which is to say, well, nothing at all.

Fluor's dependence on oil and natural gas makes it a tough call here. Yes, Fluor will be a dominant player in tidying up America's highways and bridges, but does increased infrastructure spending mean futures traders will suddenly be compelled to run up oil and natural gas prices again? That outlook is murky at best. And Fluor's shares, while not too expensive, do feature a P/E above 11 and trade at three-times current book value.

Names You Know, But Are The Stocks Trustworthy?
One doesn't need to live on a farm or work on a construction site to know Deere and Caterpillar. Caterpillar is a member of the Dow Jones Industrial Average and its performance actually lagged the downtrodden index in 2008, though Deere's performance was inferior to both.

On the other hand, finding mega-cap names that have generated alpha for shareholders in 2008 is a futile endeavor. Long-term investors can bring out their value check lists for Caterpillar and Deere and be impressed.

Let's take a look at a quick breakdown of the companies:
Dominant market positions? Check. Deere is the largest maker of farm equipment and Caterpillar is a giant in construction equipment production. Dividend yield? Check, an average of 3.2% for both companies. Respectable forward P/E ratios? Check. Both companies are at around 10 according to Thomson Financial Networks.

A Buffet for Value Investors
The Obama infrastructure plan, a modern-day impostor to the FDR and Eisenhower equivalents of eras past, presents value investors with a unique opportunity to benefit from government spending. Uncle Sam will throw money at just about anything with wanton haste, and infrastructure is a prime example. Government spending on infrastructure averages about $400 billion annually, meaning there is a big pie for the companies mentioned here (and others) to get a piece of.

It's hard to ignore the compelling value of companies like Manitowoc and Terex, who both trade under $20 a share, or the dominant market position and dividend yield of Caterpillar. Obama's plan may put these infrastructure companies on the road to riches.

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