Whether you see them or not, industrials businesses play a crucial part in our daily activities. Still, their generally high capital requirements expose them to the ups and downs of economic cycles, and the market seems confused about where we could go next. This uncertainty has led to a flat return for the industry over the past six months while the S&P 500 was up 4.1%.
The elite companies can churn out earnings growth under any circumstance, however, and our mission at StockStory is to help you find them. With that said, here are two industrials stocks boasting durable advantages and one we’re steering clear of.
One IndustrialsStock to Sell:
TPI Composites (TPIC)
Market Cap: $44.9 million
Founded in 1968, TPI Composites (NASDAQ: TPIC) manufactures composite wind turbine blades and provides related precision molding and assembly systems.
Why Should You Dump TPIC?
- Offerings couldn’t generate interest as its billings have averaged 11.5% declines over the past two years
- Eroding returns on capital from an already low base indicate that management’s recent investments are destroying value
- Unprofitable operations could lead to additional rounds of dilutive equity financing if the credit window closes
TPI Composites’s stock price of $0.94 implies a valuation ratio of 0.8x forward EV-to-EBITDA. If you’re considering TPIC for your portfolio, see our FREE research report to learn more.
Two Industrials Stocks to Watch:
Axon (AXON)
Market Cap: $58.86 billion
Providing body cameras and tasers for first responders, AXON (NASDAQ: AXON) develops technology solutions and weapons products for military, law enforcement, and civilians.
Why Is AXON a Good Business?
- Products are seeing elevated demand as its unit sales averaged 32% growth over the past two years
- Free cash flow margin expanded by 20.3 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends
- Rising returns on capital show the company is starting to reap the benefits of its past investments
At $755 per share, Axon trades at 127x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
Ingersoll Rand (IR)
Market Cap: $34.52 billion
Started with the invention of the steam drill, Ingersoll Rand (NYSE: IR) provides mission-critical air, gas, liquid, and solid flow creation solutions.
Why Could IR Be a Winner?
- Operating profits increased over the last five years as the company gained some leverage on its fixed costs and became more efficient
- Incremental sales over the last five years have been highly profitable as its earnings per share increased by 18.4% annually, topping its revenue gains
- Robust free cash flow margin of 15.7% gives it many options for capital deployment, and its improved cash conversion implies it’s becoming a less capital-intensive business
Ingersoll Rand is trading at $85.53 per share, or 24.8x forward P/E. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
High-Quality Stocks for All Market Conditions
When Trump unveiled his aggressive tariff plan in April 2024, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.
Don’t let fear keep you from great opportunities and take a look at Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.
