US Concrete CEO still supports Trump, holding out hope for a big infrastructure bill

US Concrete CEO Bill Sandbrook remains a Trump supporter, even though little progress has been made on actual infrastructure legislation.

Sandbrook told CNN Business Friday he remains optimistic about the state of the US economy. But he is disappointed by the lack of a major infrastructure bill in Washington.

Just before the 2016 presidential election, the stocks of US Concrete (USCR) and other construction companies started to surge. Wall Street believed a win by either Donald Trump or Hillary Clinton would be good news, because both talked about the need to rebuild America’s highways, bridges and other transportation infrastructure.

Shares of US Concrete went from about $50 right before Election Day in 2016 to a high of more than $85 a little more than a year later.

But since then, little progress has been made, despite calls from President Trump and leading Democrats, including Senator Chuck Schumer, to come up with a $2 trillion infrastructure deal.

With partisan rancor and Washington intransigence, few people believe Republicans and Democrats will agree on a big infrastructure bill anytime soon. Sandbrook lamented how an infrastructure deal seems to have fallen apart in what he dubbed the “partisan abyss in Washington.”

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That’s a key reason why US Concrete tumbled to a low of just under $28 last fall. The stock has since recovered to trade at around $47 and is up 32% in 2019. Still, the stock is pretty much where it was right before the 2016 election. The company reported its latest earnings Friday, which were below Wall Street’s forecasts.

Sandbrook noted it was a good sign that the Senate Environment and Public Works Committee recently voted unanimously to propose reauthorizing the Fixing America’s Surface Transportation (FAST) Act, which is set to expire in October 2020.

Although spending would increase 27%, the bill calls for just $287 billion in funding – a far cry from the $1 to $2 trillion many have hoped for as part of broader legislation.

“It’s encouraging, but it’s not as dramatic an increase in funding that’s needed,” Sandbrook told CNN Business. “It’s just a Band-Aid. And it’s unclear how it will be paid for.”

He’s been hoping for more “bold initiatives” from the federal government.

Sandbrook is happier about what’s going on at the state and local level, however. He pointed out that many states and municipalities have agreed to boost infrastructure spending. That’s a plus for US Concrete and rivals like Martin Marietta (MLM) and Vulcan Materials (VMC). Sandbrook added that pricing in the concrete business remains “robust” – another positive sign.

He also gives Washington – and the Trump administration in particular – praise for other economic initiatives.

“Outside of the lack of an infrastructure bill, you can’t argue with low unemployment, low interest rates and a business-friendly tax environment,” Sandbrook said. “This is an historically long recovery and some of the administration’s policies have enabled the US economy to extend this cycle.”

With that in mind, Sandbrook hinted that he was likely to vote for Trump again in 2020 – even though he is open to hearing the ideas of the Democratic candidates.

“I am a supporter of this administration’s economic policies. I think they are good for America,” he said.