As urbanization continues to surge globally, smart cities have emerged as a beacon of hope, promising enhanced quality of life, sustainability, and efficiency. With governments and private sectors ramping up investments in modernizing urban landscapes, infrastructure players like Hubbell Incorporated (HUBB), Clean Harbors, Inc. (CLH), and NV5 Global, Inc. (NVEE) are at the forefront of this transformation.
The global need for infrastructure investment is immense, with spending projected to reach $94 trillion by 2040. By 2050, two-thirds of the world’s population is projected to reside in cities, heightening the demand for clean water, energy-efficient buildings, smart transportation, and sustainable waste solutions. To meet these needs, cities are turning to innovative technologies that enhance efficiency, reduce environmental impact, and improve overall livability.
According to International Data Corporation (IDC), smart city investments are set to hit $189.50 billion this year, integrating cutting-edge advancements like IoT, AI, and 5G networks into urban infrastructure. These innovations will drive automation, optimize energy use, and create safer, more connected environments.
As a result, the global smart city market is projected to grow by $332.50 billion between 2024 and 2029, at a CAGR of 21.5%, fueled by the increasing adoption of IT modernization and smart city projects in emerging economies.
With cities racing to modernize, infrastructure companies are stepping up to build the future. Let’s take a closer look at the three players powering the smart cities of tomorrow.
Hubbell Incorporated (HUBB)
HUBB designs, manufactures, and sells electrical and utility solutions globally to help customers maintain reliable and efficient critical infrastructure. It operates through two segments: Electrical Solutions and Utility Solutions.
On December 16, 2024, demonstrating its commitment to returning value to shareholders, the company paid a quarterly dividend of $1.32 per share, reflecting an increase of 8% over its previous distribution.
With 8 years of consecutive dividend growth, HUBB pays a $5.28 per share dividend annually, which translates to a 1.24% yield on the current price. Its dividend payouts have grown at a 7.7% CAGR over the past three years, while its four-year average dividend yield is 1.69%.
HUBB’s trailing-12-month EBIT and levered FCF margins of 19.01% and 10.06% are 85.8% and 43.5% higher than their respective industry averages of 10.23% and 7.01%. Likewise, its trailing-12-month net income margin of 13.33% compares to the industry average of 6.49%.
For the fiscal 2024 third quarter ended September 30, 2024, HUBB’s net sales increased 4.9% year-over-year to $1.44 billion. The company’s non-GAAP operating income grew 13.6% from the prior-year quarter to $334.80 million. Also, its adjusted net income increased 13.6% year-over-year to $242.90 million, while its adjusted EPS stood at $4.49, up 13.7% year-over-year.
The consensus revenue estimate of $1.41 billion for the fiscal fourth quarter (ended December 2024) indicates a 4.9% year-over-year increase. Likewise, the consensus EPS estimate of $4.02 for the about-to-be-reported quarter reflects a rise of 8.9% from the prior year. The company has an impressive earnings surprise history; it surpassed the consensus EPS estimates in each of the trailing four quarters.
Over the past year, the stock has gained 23.9%, closing the last trading session at $426.57.
HUBB’s stance is apparent in its POWR Ratings. The stock has a B grade for Quality. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.
Among 90 stocks in the B-rated Industrial – Equipment industry, it is ranked #34. Beyond what is stated above, we’ve also rated HUBB for Growth, Value, Momentum, Stability, and Sentiment. Get all the HUBB ratings here.
Clean Harbors, Inc. (CLH)
CLH provides environmental and industrial services in the United States and internationally. The company operates through two segments: Environmental Services and Safety-Kleen Sustainability Solutions.
On November 11, 2024, CLH announced that its Safety-Kleen subsidiary would increase pricing for used oil collection services in response to rising operational costs and softening crude oil prices. The rate changes, impacting U.S. and Canadian customers, are designed to help maintain profitability for the Safety-Kleen Sustainability Solutions segment, which serves over 100,000 customers annually. The move aims to offset transportation and labor costs inflation and ensure continued financial performance.
In terms of the trailing-12-month EBITDA margin, CLH’s 18.54% is 29.8% higher than the 14.28% industry average. Likewise, its 17.68% trailing-12-month Return on Common Equity is 31.1% higher than the 13.48% industry average.
CLH’s revenue for the third quarter (ended September 30, 2024) increased 11.9% year-over-year to $1.53 billion. Its income from operations grew 24.6% from the year-ago value to $192.29 million. The company’s net income and EPS improved 26.1% and 26.2% from the prior-year quarter to $115.21 million and $2.12, respectively. In addition, its adjusted EBITDA came in at $301.81 million, up 18.4% year-over-year.
Street expects CLH’s revenue for the first quarter (ending March 2025) to increase 8.3% year-over-year to $1.49 billion. Its EPS is expected to register a 5.9% growth from the prior year, settling at $1.37. Moreover, CLH has surpassed its revenue and EPS estimates in three of the four trailing quarters, which is promising.
CLH’s shares have gained 38.2% over the year and 6.3% over the past six months to close the last trading session at $238.54.
CLH’s bright prospects are reflected in its POWR Ratings. It has an overall rating of B, which equates to Buy in our proprietary rating system.
It also has a B grade for Stability and Quality. Out of 13 stocks in the B-rated Waste Disposal industry, it is ranked #4. Click here to see the other CLH ratings for Growth, Value, Momentum, and Sentiment.
NV5 Global, Inc. (NVEE)
NVEE provides global technology, conformity assessment, consulting solutions, and software applications to public and private sector clients in infrastructure, utility services, construction, real estate, environmental, and geospatial markets. It operates through three segments: Infrastructure; Building, Technology & Sciences; and Geospatial Solutions.
On January 13, 2025, the company announced the acquisition of Group Delta, a California-based infrastructure engineering, testing, and environmental PFAS services provider. The acquisition strengthens NVEE’s capabilities in infrastructure engineering, conformity assessment, and utility fire hardening across Southern California.
In the same month, NVEE announced plans to repurchase up to $20 million of its common stock as part of its previously approved $100 million buyback program. This move underscores the company’s strong financial position and confidence in its long-term growth and profitability.
NVEE’s trailing-12-month gross profit margin of 51.76% is 61.9% higher than the industry average of 31.98%. Similarly, the stock’s 9.25% trailing-12-month levered FCF margin exceeds the 7.01% industry average by 32%.
During the third quarter, which ended September 28, 2024, NVEE’s gross revenue increased 5.6% year-over-year to $250.89 million. Its income from operations rose 39% from the year-ago value to $20.52 million. The company’s net income and adjusted EPS amounted to $17.08 million and $0.44, indicating an increase of 30.8% and 22.2% year-over-year, respectively. Also, its adjusted EBITDA came in at $44.53 million, up 21.4% over the prior-year quarter.
Analysts expect NVEE’s revenue for the fourth quarter (ended December 31, 2024) to increase 13.1% year-over-year to $243.82 million. Meanwhile, its EPS for the same period is expected to grow by 3.5% from the prior year to $0.30. However, the stock has declined 3.3% year-to-date to close the last trading session at $18.23.
NVEE’s POWR Ratings reflect its strong outlook. The stock has an overall rating of B, which equates to a Buy in our proprietary rating system.
It has a B grade for Quality and is ranked #19 out of 79 stocks in the B-rated Industrial - Services industry. To see additional POWR Ratings for Growth, Value, Momentum, Stability, and Sentiment for NVEE, click here.
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HUBB shares were trading at $428.81 per share on Friday afternoon, up $2.24 (+0.53%). Year-to-date, HUBB has gained 2.37%, versus a 3.93% rise in the benchmark S&P 500 index during the same period.
About the Author: Shweta Kumari
Shweta's profound interest in financial research and quantitative analysis led her to pursue a career as an investment analyst. She uses her knowledge to help retail investors make educated investment decisions.
3 Infrastructure Players Powering Tomorrow’s Smart Cities StockNews.com
