U.S. infrastructure may be in shambles, but infrastructure stocks are not feeling the pain.

According to one agency, structures are barely passing. In fact, the American Society of Civil Engineers’ (ASCE) gave the U.S. a D+ rating as recently as 2017. Additionally, the ASCE estimates that the country needs around $4.5 trillion by 2025 just to repair roads, airports, bridges, dams, schools and more.

Even worse, according to the ASCE:

“The cost of deteriorating infrastructure takes a toll on families’ disposable household income and impacts the quality and quantity of jobs in the U.S. economy…. From 2016 to 2025, each household will lose $3,400 each year in disposable income due to infrastructure deficiencies.”

Collectively, more than 30% of urban U.S. roads are in poor shape. And about 33% of bridges are more than 50 years old.

However, there’s hope that could soon change. Along with President Donald Trump’s infrastructure plans, Congress wants to move forward with a $760 billion plan to fund infrastructure improvement throughout the country over five years.

“The Democrats’ framework proposes $329 billion for roads and bridges, $55 billion for passenger rail, $30 billion for airport investments, $50.5 billion for wastewater infrastructure, $86 billion for expanding broadband access for rural areas, and $12 billion for a “next-generation” 911 system for emergency calls,” says The Hill contributor Cristina Marcos.

With that in mind, let’s take a look at three of the top infrastructure stocks that have sizable upside potential in the near future.

Infrastructure Stocks to Buy: Vulcan Materials (VMC)

Vulcan Materials (NYSE:VMC) is one of the companies that produces and sells construction aggregates, asphalt mix and ready-mixed concrete primarily in the U.S. for highways, airports, and government buildings, for example.

Since January 2019, VMC stock exploded from a low of $95.31 to a recent high of $149.05. Should we see progress on infrastructure programs in Congress, I believe VMC could rally to $180 per share later this year.

Plus, demand for cement and concrete additives in the US is forecasted to grow $4 billion in 2020.

The company reported decent third-quarter earnings in November, and chairman and CEO Tom Hill was excited to say the least:

“We continued to execute well during the third quarter.  The growth in our aggregates shipments and improvement in pricing were strong. …We remain focused on creating long-term value by compounding unit margins through our four strategic initiatives – commercial excellence, operational excellence, strategic sourcing and logistics innovation, which enhance price growth and operating efficiencies.”

Overall, VMC is one of the great infrastructure stocks investors could add to their portfolio.

Martin Marietta Materials (MLM)

Martin Marietta Materials (NYSE:MLM) is another one of the great infrastructure stocks to buy. The company is one of the top suppliers of aggregates and heavy building materials. Since the beginning of 2019, shares of MLM stock soared from a low of $167.62 to a recent high of $278.39 per share.

Also, the company reported its Q4 earnings earlier this week. And according to Ward Nye, Chairman, President and CEO of Martin Marietta Materials, 2019 was “the most profitable year” in the company’s history. Additionally, Nye provided some insight into the company’s 2020 forward thinking:

“Looking ahead, our 2020 outlook remains positive across our three primary construction end-use markets. We believe construction growth in Martin Marietta’s top ten states will continue to outpace national averages and serves to reinforce our positive pricing outlook. Further supported by attractive market fundamentals and demand trends across our geographic footprint, as well as region-specific third-party forecasts, we expect the current construction cycle to expand at a steady and sustainable pace.”

With all of that in mind, Stifel analyst Stanley Elliott reiterated his “buy” rating on the stock last month with a target of $300.

“In our view, as improved funding at the state and local level drives strong infrastructure spending. Aggregates pricing trends remain strong with management targeting a mid-single digit increase this year. Pricing conversations surrounding cement seem much more constructive going into 2020 than we’ve seen in the past, which is equally encouraging in our view,” the analyst said.

Overall, MLM is another great option.

Aecom (ACM)

Aecom (NYSE:ACM) is the last member of the infrastructure stocks to buy. The company is a full-service design, engineering, and construction company that operates all over the globe. They handle planning, engineering, design, program management and construction management for all types of clients.

Since January 2019, ACM stock soared from a low of $25.98 to a recent high of $49 per share this month. If there is further progress on infrastructure, I believe we could see a test of $50 in the near-term. Additionally, the stock is also rising on news of a possible merger with WSP Global.

Granted, Aecom has plenty of orders thanks to the U.S. government and infrastructure contracts. However, profits have flattened out in the past few years due to “inefficiency and construction contract losses.” That said, a deal with Aecom could potentially give WSP a bigger share of business in the U.S. an generate up to $200 million cost savings.

In turn, this could be a good thing for ACM stock.

As of this writing, Ian Cooper did not hold a position in any of the aforementioned securities.