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LXFR and PRLB saw earnings estimates rise as AI demand and factory output strengthened.
The U.S. manufacturing sector, which struggled for nearly three years, is finally trying to make a rebound. Rising inflation, high oil prices and higher tariffs remain a challenge for the sector. Yet, robust demand for goods has been helping the sector make a solid recovery.
A jump in manufacturing activity and industrial production is proof that the sector is on track for solid growth in the near term.
Given the positive sentiment, it would be ideal to invest in four stocks from the manufacturing sector — RBC Bearings Incorporated (RBC - Free Report) , Helios Technologies, Inc. (HLIO - Free Report) , Luxfer Holdings PLC (LXFR - Free Report) and Proto Labs, Inc. (PRLB - Free Report) — that we have detailed below. Each of these stocks carries a Zacks Rank #1 (Strong Buy) or 2 (Buy) and assures good returns. You can see the complete list of today’s Zacks #1 Rank stocks here.
Industrial Production Jumps
U.S. industrial production rose a solid 0.6% sequentially in April, surpassing the consensus estimate of a rise of 0.2% and the largest increase since February 2025, according to data from the Federal Reserve. This follows an upwardly revised rise of 0.1% in March.
On a year-over-year basis, industrial production rose 1.3% in April. The jump in April was primarily driven by a surge in output of motor vehicles and parts, which rose 3.7%.
Also, robust demand for technology goods, especially computers and peripherals, boosted factory output. Output of high-technology industries jumped 1% in April after rising 0.5% in the prior month. Durable goods production rose 1.2% in April.
The Fed’s report came days after the ISM Manufacturing Index showed that the PMI reading rose to 52.7 in April. Manufacturing accounts for 9.4% of the overall economy. Billions of dollars are being pumped into development toward artificial intelligence (AI), as an increasing number of businesses adapt to AI.
Output of semiconductors and related electronic components jumped 1%. Production of communications equipment gained 0.6%.
High inflation, owing to the ongoing Iran war and the impact of tariffs, remains a headwind for the overall economy. However, robust demand, thanks to the robust spending on AI, has been boosting the manufacturing sector.
4 Industrial Products Stocks With Upside
RBC Bearings Incorporated
RBC Bearings Incorporated manufactures and distributes engineered bearings and precision components. RBC’s bearings are tools that reduce damage and energy loss, and enable proper power transmission in most machines and mechanical systems.
RBC Bearings’expected earnings growth for the current year is 14.2%. The Zacks Consensus Estimate for current-year earnings has improved 0.5% over the past 60 days. RBC has a Zacks Rank #2 at present.
Helios Technologies
Helios Technologies, Inc. is an industrial technology company. HLIO develops and manufactures hydraulic and electronic control solutions. Helios Technologies’ operating subsidiaries include Sun Hydraulics, Enovation Controls and Faster Group.
Helios Technologies’ expected earnings growth for the current year is 14.2%. The Zacks Consensus Estimate for next year's earnings has improved 4% over the past 60 days. Currently, HLIO has a Zacks Rank #2.
Luxfer Holdings
Luxfer Holdings PLC is a materials technology company specializing in the design, manufacture and supply of high-performance materials, components and gas cylinders. LXFR had two divisions, Elektron and Gas Cylinders. The Elektron division focuses on specialty materials based on magnesium, zirconium and rare earths. The Gas Cylinders division manufactures products made from aluminum, composites and other metals using technically advanced processes.
Luxfer Holdings’ expected earnings growth for the current year is 8.1%. The Zacks Consensus Estimate for next year's earnings has improved 7.1% over the past 60 days. LXFR currently sports a Zacks Rank #1.
Proto Labs
Proto Labs, Inc. is an online and technology-enabled quick-turn manufacturer of custom parts for prototyping and short-run production. PRLB produces CNC-machined and injection-molded plastic parts.
Proto Labs’ expected earnings growth for the current year is 24.7%. The Zacks Consensus Estimate for current-year earnings has improved 15% over the past 60 days. PRLB currently carries a Zacks Rank #2.
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4 Stocks to Bet on as Manufacturing Activity Makes Steady Rebound
Key Takeaways
The U.S. manufacturing sector, which struggled for nearly three years, is finally trying to make a rebound. Rising inflation, high oil prices and higher tariffs remain a challenge for the sector. Yet, robust demand for goods has been helping the sector make a solid recovery.
A jump in manufacturing activity and industrial production is proof that the sector is on track for solid growth in the near term.
Given the positive sentiment, it would be ideal to invest in four stocks from the manufacturing sector — RBC Bearings Incorporated (RBC - Free Report) , Helios Technologies, Inc. (HLIO - Free Report) , Luxfer Holdings PLC (LXFR - Free Report) and Proto Labs, Inc. (PRLB - Free Report) — that we have detailed below. Each of these stocks carries a Zacks Rank #1 (Strong Buy) or 2 (Buy) and assures good returns. You can see the complete list of today’s Zacks #1 Rank stocks here.
Industrial Production Jumps
U.S. industrial production rose a solid 0.6% sequentially in April, surpassing the consensus estimate of a rise of 0.2% and the largest increase since February 2025, according to data from the Federal Reserve. This follows an upwardly revised rise of 0.1% in March.
On a year-over-year basis, industrial production rose 1.3% in April. The jump in April was primarily driven by a surge in output of motor vehicles and parts, which rose 3.7%.
Also, robust demand for technology goods, especially computers and peripherals, boosted factory output. Output of high-technology industries jumped 1% in April after rising 0.5% in the prior month. Durable goods production rose 1.2% in April.
The Fed’s report came days after the ISM Manufacturing Index showed that the PMI reading rose to 52.7 in April. Manufacturing accounts for 9.4% of the overall economy. Billions of dollars are being pumped into development toward artificial intelligence (AI), as an increasing number of businesses adapt to AI.
Output of semiconductors and related electronic components jumped 1%. Production of communications equipment gained 0.6%.
High inflation, owing to the ongoing Iran war and the impact of tariffs, remains a headwind for the overall economy. However, robust demand, thanks to the robust spending on AI, has been boosting the manufacturing sector.
4 Industrial Products Stocks With Upside
RBC Bearings Incorporated
RBC Bearings Incorporated manufactures and distributes engineered bearings and precision components. RBC’s bearings are tools that reduce damage and energy loss, and enable proper power transmission in most machines and mechanical systems.
RBC Bearings’expected earnings growth for the current year is 14.2%. The Zacks Consensus Estimate for current-year earnings has improved 0.5% over the past 60 days. RBC has a Zacks Rank #2 at present.
Helios Technologies
Helios Technologies, Inc. is an industrial technology company. HLIO develops and manufactures hydraulic and electronic control solutions. Helios Technologies’ operating subsidiaries include Sun Hydraulics, Enovation Controls and Faster Group.
Helios Technologies’ expected earnings growth for the current year is 14.2%. The Zacks Consensus Estimate for next year's earnings has improved 4% over the past 60 days. Currently, HLIO has a Zacks Rank #2.
Luxfer Holdings
Luxfer Holdings PLC is a materials technology company specializing in the design, manufacture and supply of high-performance materials, components and gas cylinders. LXFR had two divisions, Elektron and Gas Cylinders. The Elektron division focuses on specialty materials based on magnesium, zirconium and rare earths. The Gas Cylinders division manufactures products made from aluminum, composites and other metals using technically advanced processes.
Luxfer Holdings’ expected earnings growth for the current year is 8.1%. The Zacks Consensus Estimate for next year's earnings has improved 7.1% over the past 60 days. LXFR currently sports a Zacks Rank #1.
Proto Labs
Proto Labs, Inc. is an online and technology-enabled quick-turn manufacturer of custom parts for prototyping and short-run production. PRLB produces CNC-machined and injection-molded plastic parts.
Proto Labs’ expected earnings growth for the current year is 24.7%. The Zacks Consensus Estimate for current-year earnings has improved 15% over the past 60 days. PRLB currently carries a Zacks Rank #2.