The "Deglobalization" Portfolio
The world is fracturing, and supply chains are coming home. This isn't just a political slogan; it's a multi-trillion dollar capital cycle. We analyze the "Four Horsemen" building the factory of the future.
🚀 Executive Summary
- ✓ The Macro Shift: While commercial real estate (Offices) is struggling, U.S. Manufacturing construction has hit historic highs (~$2.1 Trillion rate).
- ✓ The Catalyst: The "Legislative Triad" (CHIPS, IRA, IIJA) has injected $1.2 Trillion into the system, de-risking long-term capital projects.
- ✓ The Picks: We isolate the "Four Horsemen" (CAT, DE, ETN, ROK) and three critical "Alternates" (EMR, PH, WM).
1. The "Bifurcation" of Capital
To understand this opportunity, you must look at where the capital is flowing. We are witnessing a historic split in the construction data.
- Commercial Real Estate (Dead Money): Office vacancy rates remain high, and financing has dried up.
- Manufacturing (Rocket Fuel): Driven by the CHIPS Act ($356B for semis) and the IRA ($102B for green energy), companies are spending over $16 billion per month on new factories.
- The Tax Kicker (OBBBA): The "One Big Beautiful Bill Act" allows corporations to fully deduct capital spending in year one, creating a massive financial incentive to upgrade equipment now.
Spending Trends (Indexed)
2. The "Four Horsemen" of Reshoring
CAT
The Infrastructure SovereignWhy it Wins:
The "Toll Keeper" of infrastructure. The real story is Services. CAT is on track for $28B in high-margin services revenue by 2026, using its "MineStar Command" to run fully autonomous mining sites.
DE
The Agrarian TechnocratWhy it Wins:
Deere is a software company in green paint. Its "See & Spray" AI technology reduces herbicide use by ~50%. With a goal of fully autonomous farming by 2030, Deere solves the rural labor crisis.
ETN
The Electrification UtilityWhy it Wins:
AI needs power. Eaton provides the switchgear for Data Centers to handle "Power Bursting" from AI workloads. It is the "arms dealer" for the grid upgrade required by EVs and AI.
ROK
The Brains of IndustryWhy it Wins:
Pure-play automation. Partnering with NVIDIA to bring GenAI to the factory floor. If factories cannot hire skilled workers, they must buy Rockwell's robots.
3. The Peer Watchlist
If the "Four Horsemen" feel too expensive, these three alternatives offer similar exposure with unique defensive characteristics.
| Ticker | Status | The "Edge" |
|---|---|---|
| Emerson (EMR) | Div King (68 Yrs) | Focuses on "Process Automation" (Oil & Gas/Chemicals) rather than discrete manufacturing. |
| Parker-Hannifin (PH) | Div King (68 Yrs) | Massive $11B backlog driven by Aerospace. A great diversifier. |
| Waste Mgmt (WM) | Defensive Growth | More industrial activity = more waste. The ultimate "boring" hedge. |
4. The "Friction" (Risks)
The re-industrialization thesis is strong, but not linear.
Project Delays
Labor shortages have delayed Intel's Ohio plant (to 2030) and TSMC's Arizona plant (to 2028). This pushes back revenue for suppliers.
The "Brownfield" Risk
70-80% of digital transformation projects fail. Integrating new robots into old ("brownfield") factories is notoriously difficult and costly.
Disclaimer: This analysis is for educational purposes only. Past performance does not guarantee future results. Data as of Jan 2026.