3 Industrial Stocks To Watch After Biden Signs $1 Trillion Infrastructure Bill
For investors eyeing the general state of the economy this week, things appear to be looking up. Accordingly, this could see industrial stocks among other cyclical sectors gaining in the stock market now. This would be the case as President Biden signed the highly anticipated $1 trillion infrastructure bill into law earlier this week. The likes of which will see hundreds of billions being put towards the construction of better infrastructure throughout the U.S. In turn, investors could now be shifting attention towards the top infrastructure stocks in the stock market today.
After all, these are companies that mostly produce capital goods used in the manufacturing and construction industries. Moreover, firms that also provided related services such as transportation and logistics are also considered by some to be industrials. By and large, industrials would play a crucial role in making the most of the latest spending plan moving forward. We could look at companies like Qualcomm (NASDAQ: QCOM) and General Electric (NYSE: GE) for example.
On one hand, Qualcomm recently provided a positive update on its operations at a recent investor conference. Namely, the semiconductor chip giant noted that its businesses are diversified enough, growing beyond reliance on single-end customers. Simply put, this could be the company suggesting that while Apple (NASDAQ: AAPL) remains a major client, it still has other growth avenues. As a result, QCOM stock gained by over 10% during intraday trading yesterday towards record highs. On the other hand, GE recently made headlines with news of its business split. This would show that even some of the oldest names in the industrial trade are looking for new ways to refine their operations. With all that said, could one of these top industrial stocks be worth watching now?
Top Industrial Stocks To Buy [Or Sell] Now
Boeing
Right off the bat, we will be looking at a leading name in the aerospace industry, Boeing. In brief, Boeing is a multinational corporation that designs, manufactures, and sells aerospace equipment. This ranges from airplanes, rotorcrafts, and rockets to satellites and telecommunications wares among others. As a key pick-and-shovel play in the recovering airline industry, Boeing continues to gain momentum in the current reopening trade. At the same time, BA stock is currently looking at gains of over 130% since its pandemic era low. Even so, could the company’s shares be worth investing in at their current price point?
Well, for one thing, the demand for Boeing’s aircraft offerings appears to be on the rise. As of yesterday, Indian airline operator Akasa Air is ordering 72 Boeing 737 MAX jets. According to Boeing, the deal is currently valued at almost $9 billion. Ideally, this could indicate the rise in air travel demand in international markets as well. Akasa Air CEO Vinay Dube said, “We are already witnessing a strong recovery in air travel, and we see decades of growth ahead of us.”
Not to mention, Boeing also sees potential tailwinds from the talks between President Biden and China’s President Xi earlier this week. This alongside positive signals from China’s aircraft regulators has Boeing feeling “hopeful” regarding its prospects in the Chinese market. Stan Deal, the head of Boeing’s commercial airplanes division, highlighted all of these “encouraging signs” over the weekend. Given all of this, would BA stock be a buy for you?
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Caterpillar
Following that, we have Caterpillar. As the world’s largest construction-equipment manufacturer, Caterpillar could be another go-to amidst the infrastructure bill hype. Naturally, the company’s experience in marketing construction machinery, engines, and related financial products would set it apart from the competition. With CAT stock looking at year-to-date gains of about 12%, should investors be taking note of it?
For the most part, investors that are looking at CAT stock now could be considering Caterpillar’s prospects in the current market. To provide some insight into this, we could consider looking at the company’s latest quarterly financials. Late last month, Caterpillar posted solid figures in its third-quarter earnings. To highlight, the company raked in a total revenue of $12.4 billion for the quarter, marking year-over-year gains of 25%. Additionally, Caterpillar also posted year-over-year gains of over 113% in both its net income and earnings per share.
If all that wasn’t enough, the company ended the quarter with over $8.5 billion in cash on hand. This would be after returning $2 billion to shareholders through dividends and share repurchases throughout the quarter. Overall, Caterpillar cited higher sales volume, driven by greater end-user demand for its offerings. All things considered, will you be adding CAT stock to your portfolio this week?
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FedEx
Another company to consider on industrial stocks now would be FedEx. Notably, it is among the largest logistics and transportation firms in the world today. According to FedEx, its supply chain currently consists of over 166,000 direct suppliers in the U.S. alone. The likes of which work together with its delivery division to deliver over 19 million shipments a day worldwide.
Now, FDX stock is currently up by over 11% in the past month. In theory, this could be due to the upcoming year-end holiday season where its services could be in high demand. In fact, CEO Fred Smith recently mentioned that FedEx is expecting this to be the case. According to Smith, the company predicts that there will be an additional 100 million shipments this holiday season compared to 2019. At the same time, he also notes that the company is focusing on hiring more employees. So much so that FedEx is processing about 90,000 applications just this month.
Furthermore, the company is also hard at work expanding its current logistics tech. As of last month, it is now working with Aurora, a leading autonomous tech developer, and PACCAR, one of the largest “medium-and heavy-duty vehicle” manufacturers worldwide. The trio are actively testing autonomous linehaul tech for commercial applications in FedEx’s fleet. All in all, with FedEx seemingly kicking into high gear now, would you consider investing in FDX stock?
