3 Industrial Powerhouse Stocks to Buy Hand Over Fist in June
Here are three stocks that anyone interested in the industrial sector should look closely at. They are attractive stocks for different reasons. Carpenter Technology (NYSE: CRS) is a company firing on all cylinders with significant momentum behind it. Delta Air Lines (NYSE: DAL) has good momentum, too, and it's likely to climb a wall of worry over its debt in 2024. Finally, while 3M (NYSE: MMM) is far from a perfect company, it does represent a good value option.
The case for buying the specialty alloy products company is relatively simple. Its primary end market (aerospace) is in an ongoing recovery mode, and the company is set to continue revenue growth and significant margin expansion, leading to a sharp increase in profitability.
As a manufacturer with relatively high fixed costs, Carpenter cannot cut costs significantly in a revenue downturn, such as after the lockdowns, so its operating profit margin tends to collapse when revenue falls. On the other hand, when revenue recovers, it flows through into strong margin expansion. That's exactly what's happening now as flight departures lead to more aftermarket demand, and increasing airplane production improves original equipment component demand -- Carpenter serves both markets.
Source Fool.com
