This sell follows the same logic as my immediately prior sell of Vulcan Materials.
Last week House Speaker Nancy Pelosi threw in the towel on any near-term chance for a big infrastructure spending package. The horrific jobs numbers had convinced her, she said, that speedily sending more aid to unemployed workers and small businesses took a higher priority. And she hoped a bill focused on that problem alone would move faster through Congress.
At the same time, state after state is saying that tax revenues have dropped so precipitously due to the coronavirus recession that they would have to cut spending for the upcoming year. (Most state constitutions require a balanced budget.) That means no new spending on roads and other infrastructure projects and probably a cut from current levels.
United Rentals (URI) is a great stock to own when construction projects are booming–whether infrastructure or housing. And it was a seriously undervalued stock back in January when I added it to my Jubak Picks Portfolio
But in a Bear Market nobody cares about undervalued. It’s just sell and then sell some more on every worry about a coronavirus recession,
Shares of United Rentals (URI), which rents equipment to the construction industry, are down 35.37% since I added them to my Jubak Picks Portfolio back on January 10, 2020. They were up 13.23% as of 1 p.m. New York time today.