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5 Top-Performing Industrial Stocks to Buy in September

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U.S. factories are humming despite broad scarcities of supply amid inflationary pressure. No doubt, manufacturers at the moment are finding it difficult to acquire the required raw materials and qualified labor in the middle of the coronavirus pandemic.

In fact, the spread of the more contagious delta variant of coronavirus is now threatening to disrupt global economic growth, which certainly doesn’t bode well for manufactures. In spite of such bottlenecks, a measure of manufacturing activity in the United States grew faster than expected in the month of August.

Citing a Barron’s article, the Institute of Supply Management’s Manufacturing PMI for the month of August came in at 59.9%, up from 59.5% in July, and also above economists’ projection of 58.5%. Thus, the manufacturing side of the economy is expanding since any reading above 50% indicates growth.

Moreover, the new orders index jumped to 66.7% in August from 64.9% in the prior month, as mentioned in the Barron’s article. That’s good news since the new orders index is a leading indicator of growth among manufacturers. To top it, the production index rose to 60%, quoting a MarketWatch article.

Similarly, citing a Morningstar article, the final reading of IHS Markit’s U.S. Manufacturing Business Activity PMI came in at 61.1 for August, confirming that activity in the U.S. manufacturing sector is showing no signs of contraction. Lest we forget, the U.S. Manufacturing Business Activity PMI already hit an almost 14-year high in the month of July, citing another MarketWatch article (read more: 5 Top Industrial Stocks to Buy With Strong Potential Upside).

Nonetheless, the increase in new orders for U.S. manufactured goods should certainly help the manufacturing sector stay afloat in the near term. In reality, improvement in the health crisis and trillions of dollars of financial aids improved the well-being of individuals and boosted manufacturing activities as well. Now, with surging demand for manufactured goods, manufacturers are undoubtedly finding it to be a challenge to keep pace.

Thus, with demand in the U.S. manufacturing sector remaining strong and factory activities continuing to chug along despite the coronavirus pandemic, it’s imperative for investors to consider solid industrial stocks this month for better returns. Hence, we have highlighted five such industrial stocks that possess a Zacks Rank #1 (Strong Buy) or 2 (Buy).

Belden Inc (BDC - Free Report) is engaged in the design, manufacture and retail of cable, connectivity, and networking products in markets, including industrial automation, enterprise, transportation, infrastructure, and consumer electronics. The company currently has a Zacks Rank #1. The Zacks Consensus Estimate for its current-year earnings has moved up almost 22% over the past 60 days. The company’s expected earnings growth rate for the current year is 63.6%.

Deere & Company (DE - Free Report) is the world’s largest producer of agricultural equipment, and is manufacturing agricultural machinery since 1837. The company currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings has moved up 5.7% over the past 60 days. The company’s expected earnings growth rate for the current year is 117.5%.

Mueller Industries, Inc. (MLI - Free Report) is a leading manufacturer of copper tube and fittings. The company currently has a Zacks Rank #1. The Zacks Consensus Estimate for its current-year earnings has moved up 52.4% over the past 60 days. The company’s expected earnings growth rate for the current year is 154.1%. You can see the complete list of today’s Zacks #1 Rank stocks here.

Terex Corporation (TEX - Free Report) is a global manufacturer of aerial work platforms, materials processing machinery and cranes. The company currently has a Zacks Rank #1. The Zacks Consensus Estimate for its current-year earnings has moved up 18.1% over the past 60 days. The company’s expected earnings growth rate for the current year is 2,207.69%.

Valmont Industries, Inc. (VMI - Free Report) is primarily engaged in the production of fabricated metal products, metal and concrete pole and tower structures and mechanized irrigation systems in the United States and abroad. The company currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings has moved up 9.1% over the past 60 days. The company’s expected earnings growth rate for the current year is 32%.