Industrials businesses quietly power the physical things we depend on, from cars and homes to e-commerce infrastructure. Unfortunately, this role also comes with a demand profile tethered to the ebbs and flows of the broader economy, and the industry is currently lagging as its six-month return of 2.9% has trailed the S&P 500’s 13.1% gain.
The elite companies can churn out earnings growth under any circumstance, however, and our mission at StockStory is to help you find them. On that note, here is one industrials stock boasting a durable advantage and two that may face trouble.
Two Industrials Stocks to Sell:
Old Dominion Freight Line (ODFL)
Market Cap: $37.73 billion
With its name deriving from the Commonwealth of Virginia’s nickname, Old Dominion (NASDAQ:ODFL) delivers less-than-truckload (LTL) and full-container load freight.
Why Does ODFL Worry Us?
- Declining unit sales over the past two years suggest it might have to lower prices to accelerate growth
- Earnings per share have contracted by 5.7% annually over the last two years, a headwind for returns as stock prices often echo long-term EPS performance
- Eroding returns on capital suggest its historical profit centers are aging
At $181.68 per share, Old Dominion Freight Line trades at 29.9x forward P/E. Dive into our free research report to see why there are better opportunities than ODFL.
Regal Rexnord (RRX)
Market Cap: $10.63 billion
Headquartered in Milwaukee, Regal Rexnord (NYSE:RRX) provides power transmission and industrial automation products.
Why Is RRX Not Exciting?
- Products and services are facing significant end-market challenges during this cycle as sales have declined by 2.4% annually over the last two years
- Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy
- Below-average returns on capital indicate management struggled to find compelling investment opportunities
Regal Rexnord’s stock price of $160.13 implies a valuation ratio of 14x forward P/E. To fully understand why you should be careful with RRX, check out our full research report (it’s free).
One Industrials Stock to Buy:
Curtiss-Wright (CW)
Market Cap: $20.88 billion
Formed from a merger of 12 companies, Curtiss-Wright (NYSE:CW) provides a range of products and services to the aerospace, industrial, electronic, and maritime industries.
What Makes CW Stand Out?
- 10.2% annual revenue growth over the last two years surpassed the sector average as its offerings resonated with customers
- Performance over the past two years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
- Free cash flow margin grew by 9 percentage points over the last five years, giving the company more chips to play with
Curtiss-Wright is trading at $565.17 per share, or 35.7x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
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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-micro-cap company Tecnoglass (+1,552% between June 2020 and June 2025). Find your next big winner with StockStory today.