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3 Industrials Stocks on Our Watchlist
Industrials businesses quietly power the physical things we depend on, from cars and homes to e-commerce infrastructure. But this role also comes with a demand profile tethered to the ebbs and flows of the broader economy. Thankfully, industrial end markets were stable over the past six months as the industry’s 6.7% gain has nearly mirrored the S&P 500.
Nevertheless, investors must be mindful as the cycle can unexpectedly turn. When this inevitably happens, only the elite companies will survive and ultimately thrive. With that said, here are three resilient industrials stocks at the top of our wish list.
LSI (LYTS)
Market Cap: $833.8 million
Enhancing commercial environments, LSI (NASDAQ:LYTS) provides lighting and display solutions for businesses and retailers.
Why Do We Love LYTS?
- Market share has increased this cycle as its 16.7% annual revenue growth over the last five years was exceptional
- Performance over the past five years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 35.2% outpaced its revenue gains
- Free cash flow margin jumped by 8.9 percentage points over the last five years, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends
LSI’s stock price of $23.40 implies a valuation ratio of 17.9x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
Granite Construction (GVA)
Market Cap: $5.54 billion
Having played a role in the construction of the Hoover Dam, Granite Construction (NYSE:GVA) is a provider of infrastructure solutions for roads, bridges, and other projects.
Why Do We Like GVA?
- Annual revenue growth of 13.2% over the last two years was superb and indicates its market share increased during this cycle
- 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 increased by 11.5 percentage points over the last five years, giving the company more capital to invest or return to shareholders
Granite Construction is trading at $126.65 per share, or 18.8x forward P/E. Is now a good time to buy? See for yourself in our full research report, it’s free.
Vulcan Materials (VMC)
Market Cap: $35.67 billion
Founded in 1909, Vulcan Materials (NYSE:VMC) is a producer of construction aggregates, primarily crushed stone, sand, and gravel.
Why Are We Fans of VMC?
- Market share has increased this cycle as its 10.6% annual revenue growth over the last five years was exceptional
- Operating profits increased over the last five years as the company gained some leverage on its fixed costs and became more efficient
- Free cash flow margin jumped by 5.4 percentage points over the last five years, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends
At $274.80 per share, Vulcan Materials trades at 29.8x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
But our AI platform says the party isn’t over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating Stocks for Free HERE.
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-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.