Industrial Stocks: Key Takeaways
- Industrial stocks span more industries than you might think…
- The catalysts that can move industrial stocks…
- How you can take advantage of momentum in this sector in 2024…
Traders often overlook industrial stocks because they’re not as “fun” as stocks in other sectors. But these stocks can be sleeping giants. Read on to discover how these stocks quietly chug higher but can explode with the right catalyst. (Details below.)
- FedEx Corporation (NYSE: FDX … read my analysis here)
- 3M Co (NYSE: MMM … read my analysis here)
- Teradyne Inc. (NASDAQ: TER … read my analysis here)
- CSX Corporation (NASDAQ: CSX … read my analysis here)
- Air Lease Corporation (NYSE: AL … read my analysis here)
- AMERCO (NASDAQ: UHAL … read my analysis here)
- Builders FirstSource Inc. (NYSE: BLDR … read my analysis here)
- Louisiana-Pacific Corporation (NYSE: LPX … read my analysis here)
- Deere & Company (NYSE: DE … read my analysis here)
- Generac Holdings Inc. (NYSE: GNRC … read my analysis here)
- MYR Group Inc. (NASDAQ: MYRG … read my analysis here)
- Advanced Drainage Systems Inc. (NYSE: WMS … read my analysis here)
- Acuity Brands Inc. (NYSE: AYI … read my analysis here)
- Kansas City Southern (NYSE: KSU … read my analysis here)
Table of Contents
- 1 What Are Industrial Stocks?
- 2 How to Find the Best Industrial Stocks
- 3 Top 3 Industrial Stocks for 2024
- 4 3 Best Value Industrial Stocks
- 5 The 3 Fastest-Growing Industrial Stocks
- 6 Top 5 Industrial Stocks With the Most Momentum
- 7 Industrial Stocks: Frequently Asked Questions
- 8 What Stocks Are Included in Industrials?
- 9 What Are Sectors and Industries for Industrial Stocks?
- 10 Which Industry Is Best to Trade Now?
- 11 Industrial Stocks: The Bottom Line
What Are Industrial Stocks?
Industrial stocks are companies that produce machinery, equipment, and supplies used for manufacturing and construction. Basically, they allow us to build things. BIG things.
Yep, the sector’s a pretty big deal.
It also includes transportation, professional services, and waste management. Those stocks usually perform well when the economy’s humming…
How to Find the Best Industrial Stocks
Looking for great industrial stocks to trade? Look no further!
StocksToTrade can help you find the best plays. Grab your 14-day trial of StocksToTrade here for just $7!
You can also subscribe to my NO-COST weekly newsletter, where I deliver a list of hand-picked stocks with the hottest watchlist potential.
Now, here are the top 3 industrial stocks on my watchlist…
Top 3 Industrial Stocks for 2024
There’s A LOT of good industrial stocks out there. It’s hard to settle on the best few.
But, of course, I’m a pro, so I picked the top industrial stocks for this list. As always, these are just stocks to watch. Always do your research before every trade.
Top Industrial Stocks #1: FedEx Corporation (NYSE: FDX)
Chances are you’ve probably had a few deliveries from FedEx…
FedEx is heavily involved in shipping and mail around the world. The company handles millions of packages each day. That’s a business that’s likely to do well for a long time.
But FedEx also has plans to use autonomous vehicles for deliveries down the road. Any good news on that front could be a catalyst to send this stock flying…
FDX has lost some luster since the beginning of the summer. But sometimes a sell-off means better trading opportunities down the line. That’s one more reason to watch this stock.
Top Industrial Stocks #2: 3M Co (NYSE: MMM)
3M has several different products. The company makes consumer goods, automotive parts, healthcare tools, and more. All in all, it has thousands of products in its portfolio.
Companies with a diverse portfolio like that tend to do well. Just look at how long 3M’s been around — nearly 120 years.
3M also likes to give back to its investors with a strong dividend. This doesn’t impact traders directly, but it can help push the stock higher over time. The company also likes to reinvest cash into growth opportunities.
MMM has developed a strong line of support in recent months.
Top Industrial Stocks #3: Teradyne Inc. (NASDAQ: TER)
If you’ve paid attention to the news this past year, you know how important semiconductor chips are…
Teradyne doesn’t make them, but it tests them to help improve performance and reliability.
Behemoths like Samsung, Intel, Qualcomm, IBM, and other huge players in the space all rely on Teradyne to do its job. Teradyne also helps industries with automation solutions like robotics.
TER has been a bit of a wild child this year, bouncing up and down. But wild stocks can make for great plays when you’re ready for the action.
3 Best Value Industrial Stocks
The market loves a good value stock. And when the market loves something, that can mean nice moves…
CSX Corporation (NASDAQ: CSX)
This may surprise you, but railroads are still an important part of our economy.
CSX operates about 19,500 miles of rail to transport chemicals, food products, minerals, metals, and much more. It’s one of the nation’s top transportation suppliers.
Think how big of a deal that is. This is a country full of consumers. CSX helps deliver the goods.
CSX has a P/E ratio of about 23 and is pushing into yearly highs territory…
Air Lease Corporation (NYSE: AL)
The name says it all … Air Lease buys, sells, and leases commercial aircraft to airlines. It buys aircraft from manufacturers like Boeing and Airbus and leases them to airlines.
Air travel has been down since the spring of 2020, but Air Lease actually fared well. Strong companies that can survive tough times usually do well in the market…
AL has a P/E ratio of 11.76 and is trading close to yearly lows. Recent history suggests it may be due for a bounce.
AMERCO (NASDAQ: UHAL)
AMERCO is a holding company that owns the U-Haul brand. You don’t even need to have moved to recognize that name…
U-Haul is the company’s best-known brand, but AMERCO also owns a life insurance company and an insurance company for U-Haul’s services.
UHAL has a P/E ratio of over 14. It’s a high-priced low floater, which has helped it run throughout the year.
The 3 Fastest-Growing Industrial Stocks
I can’t guarantee that these three industrial stocks will continue to grow, but they’ve been on a tear lately…
Fastest-Growing Stock #1: Builders FirstSource Inc. (NYSE: BLDR)
Builders FirstSource manufactures building materials for homebuilders, sub-contractors, and remodelers in the U.S.
It’s the largest supplier of building products and prefabricated components in the U.S. That makes it one of the best companies in its industry…
People have been buying homes like crazy over the past year. And plenty of others are remodeling. Builders FirstSource has a hand in both.
BLDR has almost doubled its revenue over the past year. It’s gained more than 23% this year and offered some choppiness for traders.
Fastest-Growing Stock #2: Louisiana-Pacific Corporation (NYSE: LPX)
Like BLDR, Louisiana-Pacific manufactures building products for new-home construction. I mentioned how the sector’s performed well this past year…
Louisiana-Pacific pioneered the production of oriented strand board, which is popular for building projects of all sorts. The company produces it more than anyone else.
LP also makes high-quality exterior wood trim that’s earned a good reputation for its appearance and durability.
LPX revenues grew over 75% this past year. The stock is up more than 60% in 2021.
Fastest-Growing Stock #3: Deere & Company (NYSE: DE)
Deere manufactures and distributes farming equipment worldwide. You’re probably familiar with its tractors…
But the company’s about more than tractors. Deere also makes lawnmowers, construction machinery, drivetrains, and diesel engines — equipment for anyone needing to tackle a big job.
In 2020, Deere killed its competition in the farm machinery space. The company plays a huge role in making farmers’ jobs more efficient.
DE revenues are up nearly 20% since the end of 2020. The stock is down lately, but it’s gained over 33% this year.
Top 5 Industrial Stocks With the Most Momentum
Want more hot industrial stocks to watch? Here are five with great momentum this year…
#1: Generac Holdings Inc. (NYSE: GNRC)
Generac manufactures and sells power generation equipment such as residential and commercial generators. It also offers other products in the energy space.
I often talk about energy stocks, but the companies that help store that energy are also great plays. Generac provides energy storage systems and grid service solutions to keep residential and industrial markets running.
Generac generators mostly run on fossil fuels. But the company also offers a solar-powered system. I wouldn’t be surprised to see more clean energy products enter GNRC’s portfolio. GNRC is up 87% since the beginning of 2021.
#2: MYR Group Inc. (NASDAQ: MYRG)
MYR Group provides electrical construction services through 14 subsidiaries in the U.S. and Canada. This includes new construction, upgrades, maintenance, repair, and more.
The company’s been around since 1891. It’s another industrial beast that will likely always have a place in the world.
MYR Group’s subsidiaries have projects with hospitals, airports, hotels, stadiums, and manufacturing plants. Yep, it’s kind of a big deal.
MYRG may not be technically defined as a low float stock with 13.5 million float, but it’s close. And it’s gained 72% in 2021.
#3: Advanced Drainage Systems Inc. (NYSE: WMS)
Advanced Drainage is a great example of a typically ‘boring’ industrial stock with upside potential…
The company makes pipes and other products for water drainage. The business may not sound sexy, but it’s necessary work that won’t go away anytime soon.
Advanced Drainage Systems is America’s second-largest plastic recycler with 155 patents on its recycled plastic products. WMS is up 45% this year.
#4: Acuity Brands Inc. (NYSE: AYI)
Acuity Brand provides lighting services for residential and commercial uses. The company literally lights up homes, office spaces, showrooms, and government buildings.
Acuity also offers control systems and software for energy and cost optimization.
Lighting is another ‘boring’ industrial play that we can easily forget about. But it’s one of those necessities. Sure helps us when we’re trading, right? AYI is up 61% on the year.
#5: Kansas City Southern (NYSE: KSU)
Yep, another train stock. I know I said it earlier, but industrial stocks like these play a huge role in the economy.
Kansas City Southern has about 6,700 miles of railroad track in the U.S. and Mexico. All KSU does is traverse the countryside and make money.
The company is making headlines these days … Canadian National wants to acquire KSU, but the Surface Transportation Board rejected a key part of the deal earlier this month.
The ruling could be challenged in court, or KSU could turn to the slightly lower offer it received from Canadian Pacific Railway. Regulators already approved that deal to move forward.
Either way, there’s movement on the horizon, and KSU is up 46% year to date.
Industrial Stocks: Frequently Asked Questions
Still interested in trading industrial stocks? Here’s a quick overview.
What Stocks Are Included in Industrials?
The industrial sector is massive. It includes companies involved in the manufacturing and transportation of goods and infrastructure construction. The industry can also include companies that provide human resources.
What Are Sectors and Industries for Industrial Stocks?
Industrial stocks almost always fall into one of these industries: construction, transportation, machinery, logistics, professional services, products, equipment, and parts. The space is big, though, so don’t necessarily consider that a definitive list.
Which Industry Is Best to Trade Now?
Go where the action is! Industrial stocks tend to do well when the economy does well. There may be opportunities in industries where demand is high, like home-building or the transportation of goods. But do your homework and keep up with news and trends.
Industrial Stocks: The Bottom Line
For some traders, industrial stocks can seem boring. They don’t offer the same excitement as biotechs or EV stocks.
But they’re key to the economy running smoothly. Plus, the market likes stocks that make money. Industrial stocks may not offer the daily craziness that traders seek … but when you see those slow grinds up, you can see why you might want to keep an eye on them.
And whether you’re a day trader or a swing trader, it’s always smart to keep market favorites on a watchlist. When they pop, you don’t want to miss out.
And remember that the news can move these stocks. So add the StocksToTrade Breaking News Chat to your trading day. Two Wall Street pros comb the news to help you find the hottest stocks catalysts. Grab your 14-day trial of STT + BNC today for just $17!
Finally, don’t let emotions rule your trading. Industrial stocks will move … you just have to pay attention.
What do you think about industrial stocks? Let me know with a comment below!