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5 Stocks to Buy on Record-High Growth in US Business Activity
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Reopening of the U.S. economy from the coronavirus-led curbs helped factory and service activities to accelerate at an unparalleled pace in the month of May. At the same time, more Americans getting vaccinated and financial relief provided by the government in recent times drove pent-up demand for services and goods.
No doubt, supply-side constraints and work backlog are on the rise as manufacturers struggle to acquire raw materials and labor, eventually leading to an uptick in the cost of businesses. But still, strong client demand helped manufacturers bear the mounting cost pressure this month. As a result, the IHS Markit Flash Manufacturing PMI came in at 61.5 for May versus 60.5 in April, touching the highest level since 2007, as mentioned in thestreet article. U.S. factory activity, in fact, saw noteworthy growth in May on the back of a record increase in new orders.
Coming to the service side of the economy, the IHS Markit's flash U.S. Services Business Activity Index came in at 70.1 for May, up from April’s reading of 64.7 and also marked a record high, citing a Morningstar article. Needless to say, service providers made the most of strong client demand as consumers continue to be confident about their well-being. The Morningstar article further said that IHS Markit’s US Composite Output Index was 68.1 in May versus 63.5 in the previous month. May’s composite reading easily surpassed economists’ expectations and April’s earlier record high, the IHS Markit added.
Chief business economist at IHS Markit, Chris Williamson, in the meanwhile, said that “the U.S. economy saw a spectacular acceleration of growth in May, the rate of expansion of business activity soaring well above anything previously recorded in recent history as the economy continued to reopen from Covid-19 restrictions,” as quoted in the Morningstar article.
He added “the service sector saw an especially impressive surge in growth, beating all prior records by a wide margin, accompanied by another solid expansion of manufacturing output,” as cited in thestreet article.
Thus, it can be safely concluded that both manufacturing and service side activity have regained steam after the difficulties witnessed last year. Hence, investing in sound stocks from the aforementioned areas seems judicious at the moment. We have selected such stocks that currently flaunt a Zacks Rank #1 (Strong Buy) or 2 (Buy) and a VGM Score of A or B. Here V stands for Value, G for Growth and M for Momentum and the score is a weighted combination of these three metrics. Such a score allows you to eliminate the negative aspects of stocks and select winners.
Applied Industrial Technologies, Inc. (AIT - Free Report) is a distributor of value-added industrial products. The company currently has a Zacks Rank #2 and a VGM Score of A. The Zacks Consensus Estimate for its current-year earnings has moved up nearly 12% over the past 60 days. The company’s expected earnings growth rate for the current year is 15.2%.
Caterpillar Inc. (CAT - Free Report) is the largest global manufacturer of construction and mining equipment. The company currently has a Zacks Rank #2 and a VGM Score of B. The Zacks Consensus Estimate for its current-year earnings has moved up 19.7% over the past 60 days. The company’s expected earnings growth rate for the current year is 47.3%.
Deere & Company (DE - Free Report) is the world’s largest producer of agricultural equipment and manufacturing agricultural machinery since 1837 under the iconic John Deere brand. The company currently has a Zacks Rank #2 and a VGM Score of B. The Zacks Consensus Estimate for its current-year earnings has moved up 0.1% over the past 60 days. The company’s expected earnings growth rate for the current year is 84.2%.
TrueBlue, Inc. (TBI - Free Report) is a leading provider of specialized workforce solutions, helping clients improve growth and performance by providing staffing, workforce management, and recruitment process outsourcing solutions. The company currently has a Zacks Rank #1 and a VGM Score of A. The Zacks Consensus Estimate for its current-year earnings has moved up 17.4% over the past 60 days. The company’s expected earnings growth rate for the current year is 197.7%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Brink's Company (BCO - Free Report) provides secure transportation, cash management, and other security-related services in North America. The company currently has a Zacks Rank #2 and a VGM Score of A. The Zacks Consensus Estimate for its current-year earnings has moved up 6% over the past 60 days. The company’s expected earnings growth rate for the current year is 31.4%.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
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5 Stocks to Buy on Record-High Growth in US Business Activity
Reopening of the U.S. economy from the coronavirus-led curbs helped factory and service activities to accelerate at an unparalleled pace in the month of May. At the same time, more Americans getting vaccinated and financial relief provided by the government in recent times drove pent-up demand for services and goods.
No doubt, supply-side constraints and work backlog are on the rise as manufacturers struggle to acquire raw materials and labor, eventually leading to an uptick in the cost of businesses. But still, strong client demand helped manufacturers bear the mounting cost pressure this month. As a result, the IHS Markit Flash Manufacturing PMI came in at 61.5 for May versus 60.5 in April, touching the highest level since 2007, as mentioned in thestreet article. U.S. factory activity, in fact, saw noteworthy growth in May on the back of a record increase in new orders.
Coming to the service side of the economy, the IHS Markit's flash U.S. Services Business Activity Index came in at 70.1 for May, up from April’s reading of 64.7 and also marked a record high, citing a Morningstar article. Needless to say, service providers made the most of strong client demand as consumers continue to be confident about their well-being. The Morningstar article further said that IHS Markit’s US Composite Output Index was 68.1 in May versus 63.5 in the previous month. May’s composite reading easily surpassed economists’ expectations and April’s earlier record high, the IHS Markit added.
Chief business economist at IHS Markit, Chris Williamson, in the meanwhile, said that “the U.S. economy saw a spectacular acceleration of growth in May, the rate of expansion of business activity soaring well above anything previously recorded in recent history as the economy continued to reopen from Covid-19 restrictions,” as quoted in the Morningstar article.
He added “the service sector saw an especially impressive surge in growth, beating all prior records by a wide margin, accompanied by another solid expansion of manufacturing output,” as cited in thestreet article.
Thus, it can be safely concluded that both manufacturing and service side activity have regained steam after the difficulties witnessed last year. Hence, investing in sound stocks from the aforementioned areas seems judicious at the moment. We have selected such stocks that currently flaunt a Zacks Rank #1 (Strong Buy) or 2 (Buy) and a VGM Score of A or B. Here V stands for Value, G for Growth and M for Momentum and the score is a weighted combination of these three metrics. Such a score allows you to eliminate the negative aspects of stocks and select winners.
Applied Industrial Technologies, Inc. (AIT - Free Report) is a distributor of value-added industrial products. The company currently has a Zacks Rank #2 and a VGM Score of A. The Zacks Consensus Estimate for its current-year earnings has moved up nearly 12% over the past 60 days. The company’s expected earnings growth rate for the current year is 15.2%.
Caterpillar Inc. (CAT - Free Report) is the largest global manufacturer of construction and mining equipment. The company currently has a Zacks Rank #2 and a VGM Score of B. The Zacks Consensus Estimate for its current-year earnings has moved up 19.7% over the past 60 days. The company’s expected earnings growth rate for the current year is 47.3%.
Deere & Company (DE - Free Report) is the world’s largest producer of agricultural equipment and manufacturing agricultural machinery since 1837 under the iconic John Deere brand. The company currently has a Zacks Rank #2 and a VGM Score of B. The Zacks Consensus Estimate for its current-year earnings has moved up 0.1% over the past 60 days. The company’s expected earnings growth rate for the current year is 84.2%.
TrueBlue, Inc. (TBI - Free Report) is a leading provider of specialized workforce solutions, helping clients improve growth and performance by providing staffing, workforce management, and recruitment process outsourcing solutions. The company currently has a Zacks Rank #1 and a VGM Score of A. The Zacks Consensus Estimate for its current-year earnings has moved up 17.4% over the past 60 days. The company’s expected earnings growth rate for the current year is 197.7%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Brink's Company (BCO - Free Report) provides secure transportation, cash management, and other security-related services in North America. The company currently has a Zacks Rank #2 and a VGM Score of A. The Zacks Consensus Estimate for its current-year earnings has moved up 6% over the past 60 days. The company’s expected earnings growth rate for the current year is 31.4%.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
Download FREE: How to Profit from Trillions on Spending for Infrastructure >>