5 Best Industrial Sector Stocks to Buy Now for 2021 | Summary and Q&A

TL;DR

Industrial stocks have underperformed in the past year but are showing signs of a rebound, offering potential for higher returns in 2021.

Key Insights

• ❓ The industrial sector has rebound potential in 2021 after a period of underperformance.
• 👾 Specific catalysts, such as defense modernization and space missions, can drive growth in industrial stocks.
• 🧑‍⚕️ Balance sheet health and the ability to cover short-term expenses are crucial factors to consider when investing in industrial stocks.
• 💗 FedEx benefits from the growing demand for e-commerce and stands to gain from the distribution of COVID-19 vaccines.
• 💪 Caterpillar has a strong dividend history and the potential for growth through infrastructure spending and mining industry orders.
• 🍉 General Dynamics, as a defense contractor, benefits from long-term contract cycles and a substantial backlog of orders.
• 💐 Roper Technologies acquires software companies for cash flow generation and low cost of capital, positioning it for potential acquisitions.

Transcript

hey bowtie nation joseph holg here with the let's talk money channel and another video in our 2021 investing series covering all the best stocks to buy for those higher returns next year and nation today we're covering five stocks from a sector of the economy that could be the turnaround story of the year stocks in the industrial sector so think ma... Read More

Questions & Answers

Q: Why were industrial stocks among the worst performers in the past year?

Industrial stocks suffered due to the economic downturn caused by the pandemic. With construction projects postponed and reduced manufacturing activity, demand for machinery and equipment decreased.

Q: What factors should investors consider when choosing industrial stocks?

Investors should look for specific catalysts for growth within each company, a healthy balance sheet, and the ability to cover short-term expenses and debt. Diversification across different industries within the industrial sector is also recommended.

Q: Why is KBR Inc. a good industrial stock to consider?

KBR Inc. is an engineering and construction company with a strong dividend yield and growth potential in its defense modernization and space mission solution segments. The company's healthy balance sheet and cash position make it an attractive investment.

Q: What are the catalysts for future growth for FedEx stock?

FedEx, the world's largest global express shipping company, benefits from the growing demand for e-commerce and online sales. The distribution of COVID-19 vaccines presents an additional growth opportunity for the company.

Q: How does Caterpillar stand out among industrial stocks?

Caterpillar, a renowned manufacturer of heavy equipment, is well-positioned to benefit from potential infrastructure spending and strong orders in the mining industry. The company's balance sheet strength and dividend history make it a reliable investment option.

Summary & Key Takeaways

• Industrial stocks have been among the worst performers, with a 6.3% return in the past 12 months.

• However, the economic rebound has turned the industrial sector into a recovery story, gaining nearly 14% in the last three months.

• These stocks not only offer potential for higher returns in 2021 but also provide dividend income.