The Bullish Bears break down a list of the largest industrial stocks and ETFs list. Industrial stocks produce and provide products and services related to manufacturing, transportation, and commercial and professional services. These companies may operate in subsectors such as aerospace and defense, air freight and logistics, construction equipment and building supplies, and transportation. Industrial stocks may be more suitable for risk-tolerant investors due to the sector’s cyclical nature.
Strong industrial companies have diversified operations, low operating costs, and investment-grade credit ratings. As a result, industrial stocks may offer the potential for strong returns in a booming economy but may also be affected by economic downturns. Industrial sector companies include Lockheed Martin, Honeywell International, and 3M.
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Table of Contents
List of the Largest Industrial Stocks
| Symbol | Name | Industry |
|---|---|---|
| UPS | United Parcel Service, Inc. | Integrated Freight & Logistics |
| RTX | Raytheon Technologies Corporation | Aerospace & Defense |
| HON | Honeywell International Inc. | Specialty Industrial Machinery |
| UNP | Union Pacific Corporation | Railroads |
| DE | Deere & Company | Farm & Heavy Construction Machinery |
| LMT | Lockheed Martin Corporation | Aerospace & Defense |
| CAT | Caterpillar Inc. | Farm & Heavy Construction Machinery |
| BA | The Boeing Company | Aerospace & Defense |
| ADP | Automatic Data Processing, Inc. | Staffing & Employment Services |
| GE | General Electric Company | Specialty Industrial Machinery |
| NOC | Northrop Grumman Corporation | Aerospace & Defense |
| GD | General Dynamics Corporation | Aerospace & Defense |
| ITW | Illinois Tool Works Inc. | Specialty Industrial Machinery |
| MMM | 3M Company | Specialty Industrial Machinery |
| CSX | CSX Corporation | Railroads |
| WM | Waste Management, Inc. | Waste Management |
| NSC | Norfolk Southern Corporation | Railroads |
| EMR | Emerson Electric Co. | Specialty Industrial Machinery |
| ROP | Roper Technologies, Inc. | Specialty Industrial Machinery |
| CTAS | Cintas Corporation | Specialty Business Services |
What Are Industrial Stocks?
The industrial sector includes many different industries that operate within the economy. Generally speaking, most industrial companies are involved in some process of the manufacturing and distribution of capital goods. These capital goods can be consumer products, or they can be commercial services that aid in the continued cyclicity of the economy.
Another term often used for the industrial sector is the secondary sector. In contrast to industrials, the primary sector consists of things that process raw materials or commodities like mining or agriculture. The two sectors work together to produce most goods and services used domestically or exported to other countries.
Industrial stocks are usually seen as value stocks because they are well-established, profitable companies with a strong industry moat that generates ample cash flow. Many of the stocks on this list are industry leaders with a long history of outperforming the market. While they don’t come with the same potential for growth as other sectors, industrials can provide a strong bedrock for your portfolio.
Are Industrial Stocks a Good Investment?
Industrial stocks have historically been good investments for any diversified portfolio. Usually, there is little volatility in the price of industrial stocks. This is because they trade at low price multiples and see consistent performance from the company. Many industrial stocks also pay generous dividends to shareholders, indicating strong cash flow.
Determining if a stock or sector is a good investment will depend on the investor. Industrial stocks are great for experienced investors looking for stability and cash flow from dividends. Younger investors with a higher risk tolerance might not be as interested in industrial stocks. Make sure that investing in industrial stocks fits your investment strategy and goals.
List of the Best Industrial Stocks
1. Waste Management (NYSE: WM)
Regarding industrial stocks, few sectors are as important to a functioning society as waste management. Look no further than the company called Waste Management, one of North America’s leading sanitation and waste removal brands.
With lucrative government contracts, Waste Management serves many of North America’s largest metropolitan areas. This shows why Waste Management has been an incredible stock, returning more than 90% over the past five years. The company also pays a 1.57% dividend yield, which equates to about $2.80 per share annually. It also routinely does share buybacks to help improve shareholder value.
With a strong balance sheet, plenty of cash flow, and a history of taking care of its shareholders, Waste Management stock should be at the top of any list of the best industrial stocks to buy.
2. Caterpillar (NYSE: CAT)
Caterpillar is a leader in construction and manufacturing equipment that is used around the world. It is a name that is synonymous with high-quality industrial equipment and has long been a blue-chip stock that has been a market leader.
This stock is a component of the Dow Jones Industrial Average and the S&P 100 and S&P 500 indexes. Caterpillar has long been used as a bellwether stock by the markets to determine the relative strength of the global economy. When Caterpillar sales are strong, it is a good indication that manufacturing and construction are booming worldwide.
CAT has also treated its shareholders well over the years, with a stellar 121% return over the past five years. The stock also pays out a 1.78% dividend yield that it has raised for 28 consecutive years, making it an exclusive member of the S&P 500 Dividend Aristocrat club.
3. 3M (NYSE: MMM)
3M is one of the quintessential industrial companies that is recognized around the world. If you were wondering, the 3M stands for the Minnesota Mining and Manufacturing Company. This company produces everything from Post-it Notes to N95 masks to dental hygiene products. According to its website, 3M produces over 60,000 different products.
This stock is also a long-time member of the Dow Jones Industrial Average and the S&P 100 and S&P 500 indexes. It’s been a rough few years for 3M shareholders following several lawsuits and legal settlements. Shares have returned a loss of about 45% over the past five years.
One thing consistent about 3M’s stock is its dividend. Not only is 3M a Dividend Aristocrat, but it is also a Dividend King, as it has raised its dividend each year for over 60 years.
4. Honeywell Intl. (NASDAQ: HON)
When you think Honeywell, you might immediately think of fans or personal heaters. But this 118-year-old Indiana-based company is an industrial giant that produces everything from personal safety equipment to aerospace products like cockpit navigation systems and jet engines.
Honeywell is another industrial company that is a Dow Jones Industrial Average component. The stock pays a nice 2.15% dividend yield and has returned 42% to shareholders over the past five years.
5. Deere & Company (NYSE: DE)
Deere & Company, better known as John Deere, is an American agricultural machinery and heavy equipment manufacturer. The signature green and yellow deer logo is a staple throughout the heartland of America and has been a foundational American company since 1837.
The stock has been an overperformer and is one of the best industrial stocks in 2024. Shares have returned an impressive 135% over the past five years while paying a dividend yield of 1.52%.
Industrials ETF List
| Symbol | Name | Industry |
|---|---|---|
| XLI | Industrial Select Sector SPDR Fund | Broad Industrials |
| ITA | iShares U.S. Aerospace & Defense ETF | Aerospace & Defense |
| VIS | Vanguard Industrials ETF | Broad Industrials |
| JETS | U.S. Global Jets ETF | Airlines |
| PHO | Invesco Water Resources ETF | Water |
| PPA | Invesco Aerospace & Defense ETF | Aerospace & Defense |
| FXR | First Trust Industrials/Producer Durables AlphaDEX Fund | Broad Industrials |
| XAR | SPDR S&P Aerospace & Defense ETF | Aerospace & Defense |
| IYJ | iShares U.S. Industrials ETF | Broad Industrials |
| FIW | First Trust Water ETF | Water |
| CGW | Invesco S&P Global Water Index ETF | Water |
| FIDU | Fidelity MSCI Industrial Index ETF | Broad Industrials |
| IYT | iShares US Transportation ETF | Transportation |
| XTN | SPDR S&P Transportation ETF | Transportation |
| EXI | iShares Global Industrials ETF | Broad Industrials |
| RGI | Invesco S&P 500® Equal Weight Industrials ETF | Broad Industrials |
| PIO | Invesco Global Water ETF | Water |
| ARKX | ARK Space Exploration & Innovation ETF | Aerospace & Defense |
| AIRR | First Trust RBA American Industrial Renaissance ETF | Broad Industrials |
| DFEN | Direxion Daily Aerospace & Defense Bull 3X Shares | Aerospace & Defense |
| HDGE | AdvisorShares Ranger Equity Bear ETF | Broad Industrials |
| AWAY | ETFMG Travel Tech ETF | Transportation |
| PRN | Invesco DWA Industrials Momentum ETF | Broad Industrials |
| EVX | VanEck Environmental Services ETF | Environmental Services |
| PSCI | Invesco S&P SmallCap Industrials ETF | Broad Industrials |
| EBLU | Ecofin Global Water ESG Fund | Water |
| FTXR | First Trust Nasdaq Transportation ETF | Transportation |
| HAIL | SPDR S&P Kensho Smart Mobility ETF | Transportation |
| BDRY | Breakwave Dry Bulk Shipping ETF | Shipping |
| FITE | SPDR S&P Kensho Future Security ETF | Aerospace & Defense |
| DUSL | Direxion Daily Industrials Bull 3X Shares | Broad Industrials |
| TPOR | Direxion Daily Transportation Bull 3X Shares | Transportation |
| TEMP | JPMorgan Climate Change Solutions ETF | Global Warming |
| BOAT | SonicShares Global Shipping ETF | Shipping |
| ROKT | SPDR S&P Kensho Final Frontiers ETF | Broad Industrials |
| UXI | ProShares Ultra Industrials | Broad Industrials |
| MOTO | SmartETFs Smart Transportation & Technology ETF | Transportation |
| RFEU | First Trust RiverFront Dynamic Europe ETF | Broad Industrials |
| AQWA | Global X Clean Water ETF | Water |
| CHII | Global X MSCI China Industrials ETF | Broad Industrials |
| IWTR | iShares MSCI Water Management Multisector ETF | Water |
| SEA | U.S. Global Sea to Sky Cargo ETF | Shipping |
| CLNR | IQ Cleaner Transport ETF | Transportation |
| BECO | BlackRock Future Climate and Sustainable Economy ETF | Global Warming |
| SIJ | ProShares UltraShort Industrials | Broad Industrials |
| SUPL | ProShares Supply Chain Logistics ETF | Broad Industrials |
| MAKX | ProShares S&P Kensho Smart Factories ETF | Manufacturing |
Final Thoughts: Industrial Stocks List
For the most part, industrial stocks are stable and safe positions to own in your portfolio. Sometimes, they can be too safe because they sacrifice growth for stability. If you are young or have a higher risk tolerance, industrial stocks might not be the optimal investment strategy.
Industrial stocks are cyclical and are reliant on a strong global economy. Many industrial sectors will slow down During an economic downturn or recession. This will have a direct impact on the performance of industrial companies.
Lawsuits, legal settlements, and recalls can also impact an industrial stock’s performance. This has recently affected companies like 3M and Boeing and can suddenly negate an otherwise strong investment thesis in the stock.
