Industrials businesses quietly power the physical things we depend on, from cars and homes to e-commerce infrastructure. Still, their generally high capital requirements expose them to the ups and downs of economic cycles, and the industry’s six-month return of 1.5% has fallen short of the S&P 500’s 12.7% rise.
Only some companies are subject to these dynamics, however, and a handful of high-quality businesses can deliver earnings growth in any environment. Taking that into account, here are two resilient industrials stocks at the top of our wish list and one that may face trouble.
One Industrials Stock to Sell:
JELD-WEN (JELD)
Market Cap: $176.1 million
Founded in the 1960s as a general wood-making company, JELD-WEN (NYSE: JELD) manufactures doors, windows, and other related building products.
Why Do We Pass on JELD?
- Organic sales performance over the past two years indicates the company may need to make strategic adjustments or rely on M&A to catalyze faster growth
- Eroding returns on capital from an already low base indicate that management’s recent investments are destroying value
- Depletion of cash reserves could lead to a fundraising event that triggers shareholder dilution
JELD-WEN is trading at $2.08 per share, or 9.2x forward EV-to-EBITDA. Read our free research report to see why you should think twice about including JELD in your portfolio.
Two Industrials Stocks to Watch:
APi (APG)
Market Cap: $16.15 billion
Started in 1926 as an insulation contractor, APi (NYSE: APG) provides life safety solutions and specialty services for buildings and infrastructure.
Why Is APG a Good Business?
- Impressive 18.5% annual revenue growth over the last five years indicates it’s winning market share this cycle
- Additional sales over the last two years increased its profitability as the 17.5% annual growth in its earnings per share outpaced its revenue
- Free cash flow margin grew by 7.2 percentage points over the last five years, giving the company more chips to play with
At $38.35 per share, APi trades at 20.6x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
Caterpillar (CAT)
Market Cap: $370 billion
With its iconic yellow machinery working on construction sites, Caterpillar (NYSE: CAT) manufactures construction equipment like bulldozers, excavators, and parts and maintenance services.
Why Do We Watch CAT?
- Annual revenue growth of 10.2% over the last five years beat the sector average and underscores the unique value of its offerings
- Share repurchases have amplified shareholder returns as its annual earnings per share growth of 21.7% exceeded its revenue gains over the last five years
- Free cash flow margin expanded by 6.6 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends
Caterpillar’s stock price of $803.88 implies a valuation ratio of 28.4x forward P/E. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
Stocks We Like Even More
ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time.
Find out which stocks our AI platform is flagging this week. See this week’s Strong Momentum stocks — FREE. Get Our Strong Momentum Stocks for Free HERE.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.
