Three ways to profit from America's problem pipes

America's ailing infrastructure is on the verge of collapse. To prevent more home-swallowing sinkholes and disease-spreading sewage spills, heavy investment is needed. We pick three stocks set to benefit.

As the hurricane season approaches in the US, homeowners are battening down the hatches for what could be a particularly brutal few months. But the real threat may be right beneath their feet America's ailing water infrastructure is on the verge of collapse. "A little-known secret," says Thomas Rooney, president of Insituform Technologies, "is the fact that the large-diameter pipes are starting to leak in Los Angeles, New York and other major cities. When these pipes go it will be front-page news." And as pipes burst and sewage spills into the water system and into the headlines, there will be a huge demand for companies that can replace the existing pipelines.

In the US, the network of drinking water pipes extends more than 700,000 miles more than four times the length of the national highway system. Much of this infrastructure is more than 100 years old and is now unsurprisingly in a state of utter disrepair. The reality of this crisis is starting to be felt all across the States. In Los Angeles this year, a broken water main created a sinkhole 30ft deep and shut down half of the Pacific Coast Highway near Malibu. In Brooklyn, meanwhile, a 64-year-old woman fell into a 5ft sinkhole in front of her house.

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