Wall Street Just Upgraded These Infrastructure Winners to a Buy!

Today, we are taking a look at three stocks across the industrial and materials sectors that just received analyst upgrades this week. So, let's get into it. All right, guys. Welcome back. Thank you all so much for being here. Today, we're taking a look at three stocks that were just upgraded to a buy this week from Wall Street analysts. And these aren't flashy AI-related names. These are companies that are working behind the scenes on some of the biggest themes in the market right now, from power grid expansion and data center construction to water infrastructure and industrial coatings. We're going to take a look at each of these companies, what it is that they do, and what has Wall Street feeling bullish about their future potential. You can follow along over on the TipRanks website or right on the TipRanks mobile app, which you can download using links in the description below. And if you enjoyed today's video, make sure you hit that thumbs up button and that you're subscribed to the channel. Now, let's dive right into our recently upgraded stocks. First on the list, we're taking a look at Quanta Services. They trade under the ticker PWR, currently priced at about $713 per share. Their stock has gained 113% in the past year and is up 27% in the last 3 months. Using Samuel AI to analyze the chart, if we scroll down to the bottom, we can see the overall takeaway is an out-perform if fundamentals hold with their earnings beat trajectory intact and their data center backlog growing. Quanta Services is one of North America's largest infrastructure contractors. The company builds and maintains electric power transmission systems, utility networks, renewable energy projects, pipeline infrastructure, and communication networks. As electricity demand surges from AI data centers, manufacturing reshoring, and grid modernization efforts, Quanta has become one of the biggest beneficiaries of the massive infrastructure spending cycle currently underway. The stock has been climbing after their strong Q1 earnings report, which they shared at the end of April. Their quarterly earnings of $2.68 grew by nearly 51% year-over-year. The company had record backlog of $48.5 billion and Q1 revenue jumped 26% year-over-year to about $7.9 billion. Management also raised its full year revenue and earnings guidance. The biggest story behind Quanta Services is demand. And just yesterday, we had a five-star analyst at Oppenheimer upgrade their stock to a buy, saying the company is positioned in markets with superior growth prospects. Quanta's exposure to power generation, complex facilities development, underground delivery network modernization, and pipeline are necessary to support electrification demands, AI development, and other secular drivers. They expect the stock to maintain a premium valuation and see potential margin expansion for Quanta. The stock has 17 current analyst ratings, coming in as a strong buy with 14 buys, two holds, and even one sell. The average price target is $794, implying an upside potential of nearly 12%. We do have a $250 range here from our low to high-end price targets. Looking at the recent ratings, on the low end, we have a hold with a slight downside of 2 and 1/2%. And a couple high-end price targets with upside of over 26% for our second stock, we're taking a look at Advanced Drainage Systems. Their stock trades under the ticker WMS, currently priced at $139 per share. It is up 27% overall in the past year, but in the last 3 months is down nearly 17%. Using Samuel AI to analyze the chart, WMS is a strong fundamental compounder, but technical deterioration since February signals a pullback within an otherwise bullish structure. And upside depends on near-term stabilization and their Q2 guidance. Advanced Drainage System manufactures water management products used in residential, commercial agricultural and infrastructure projects. Their products help move, store, and manage stormwater and wastewater through underground pipe systems and drainage solutions. Think of it as one of the key suppliers supporting modern water and infrastructure and construction projects. They shared their Q4 earnings report on May 20th, and the results were better than expected. Earnings per share of $1.07 came in well ahead of analyst expectations. Revenue climbed 10% year-over-year to $677 million, and their fiscal 2026 free cash flow was $569 million, up over $200 million from the year before. The company also guided for future revenue guidance above Wall Street forecasts. And 2 days ago, we heard from a four and a half-star analyst at Oppenheimer who upgraded the stock based on an attractive setup, saying that the company has a history of guiding volume conservatively. And encouragingly, that there's no evidence or expectation thus far that price increases would lead to meaningful volume compression. They believe likely conservative volume guidance, coupled with some degree of potential price cost benefit as material input cost inflation abates, provides an attractive setup. And with six current analyst ratings, Advanced Drainage Systems does come in as a unanimous strong buy. The average price target of $184 implies an upside potential of 31 and 1/2%. Looking at the ratings down below, they range from an upside of 20% up to 46 and 1/2%. If you've made it to our third stock today, then this is a reminder to make sure you've hit that thumbs up button. Third on the list, we're looking at RPM International. Their stock trades under the ticker RPM, currently priced at $107 per share. It is in the red 6% over the past year, and in the last 3 months is down just over 3%. Analyzing the chart on this one, if we look down at the takeaway here, it says the fundamentals and analyst sentiment justify medium-term outperformance, but near-term overbought conditions and moving average weakness demand a pullback towards 100 to $104 or a sustained break above 110 for confidence. An entry on weakness is preferable to chasing into overbought. RPM is a specialty coatings and sealants company. They produce coatings, sealants, roofing materials, concrete repair products, and specialty chemicals, serving construction, manufacturing, maintenance, and consumer markets around the world. One of their most recognizable brands is Rust-Oleum. It is certainly worth noting that RPM is a dividend king, raising its dividend for 52 consecutive years. And earlier in April, they came out with record Q3 earnings results. Earnings per share of 57 cents came in 22 cents ahead of analyst expectations and climbed nearly 63% year over year. They reported record revenue of $1.61 billion, which grew 9% year over year, and management highlighted continued margin improvements and strong execution across its operating segments. And upgrading their stock to a buy just 2 days ago was a four-star analyst from UBS. They said they have a more constructive view of RPM's pricing power in the current inflationary cycle. An inflection in non-residential spending in the second half of the year and increased manufacturing and industrial link CapEx spend in the US should be positive for the company. They see an attractive setup at current share levels. RPM has 10 current analyst ratings and comes in as a strong buy with nine buys and one hold. The average price target of $129 implies an upside potential of over 20%. Looking at those price targets down below, they range from an upside of 16 and 1/2% up to 38%. So, that is a quick look at three stocks all tied to infrastructure spending, all beating earnings, and all receiving an analyst upgrade. Let me know your thoughts on these companies in the comments down below and which one you think has the biggest upside potential. I always appreciate hearing from you guys. Please keep in mind these videos are never suggestion to buy or sell any specific stock, so please make sure you always do your own research and due diligence. Thanks so much for watching. Have a wonderful day and I'll see you back here next time.