CEMATRIX (CVX, TSX-V): Cellular Concrete Solutions

“Phase IV” if you prefer roman numerals, or just Phase 4 if you don’t, the next phase of stimulus money is going to shower itself over critical infrastructure. Across America and Canada, roads, rails, airports, bridges, water utilities, and much more need repair and improvement. Critical infrastructure has been neglected for decades, and that capital injection (possibly $2 trillion) will be YUUGE for some construction materials providers, builders, and engineering groups.

As talk of Phase IV advances and ultimately materializes in a $1 or $2 trillion spend on infrastructure, CEMATRIX is a “hidden gem” that will benefit biglee.

This will be absolutely yuuge for CEMATRIX, which owns 3 of the 4 largest cellular concrete operations across the U.S. and Canada (yet has a market cap of only $24 million CDN).

During one of his news conferences earlier this week, President Trump reiterated his want/demand for a Phase IV infrastructure stimulus program. Trump told Steven Mnuchin, Secretary of the Treasury, to “get it done”.

Get it done, Steve.

I think it’s gonna happen, but a beautiful factor concerning the stock (CVX) is that it should perform great with or without “new trillions” in infrastructure spending.

CEMATRIX already has a backlog of approximately $78 million, after announcing another $2.9 million of contracts that have been awarded to MixOnSite USA and Pacific International Grout (wholly-owned subsidiaries). They also announced a $5.5 million financing this week to help fund this anticipated growth while strengthening the balance sheet.

“Even though the business of designing, tendering and quoting infrastructure projects has slowed down a bit as a result of the COVID-19 Pandemic, CEMATRIX still continues to land new projects throughout North America,” stated Jeff Kendrick, CEMATRIX President and CEO. “In addition, in order to help Americans and Canadians revive both economies, strong signals are being sent by different levels of governments that infrastructure focused spending will be part of future stimulus packages. CEMATRIX is extremely well positioned to benefit from these infrastructure focused initiatives. This opportunity was recently confirmed in part by announcements in the U.S. to move forward on 2 trillion dollars’ worth of infrastructure replacement projects.”

Yeah, so I’m a buyer of CVX and I especially like it in the 30-cent range (minor resistance at 40 and major support at 30 cents). When talk of Phase IV really starts heating up, smart speculators will start connecting the dots and conclude CVX is an awesome way to play. CVX has great potential to become a true “story stock”.

Please don’t hesitate to leave a comment if you’ve got any questions or statements to make (political or otherwise).