4 Industrial Manufacturing Stocks to Gain Despite Industry Headwinds

Industry Overview - The Zacks Manufacturing – General Industrial industry includes companies producing a variety of industrial equipment, such as power transmission products, bearings, and fluid power components, serving sectors like mining, oil and gas, and agriculture [3] - The industry is currently facing challenges due to a slowdown in new orders, supply-chain issues, and a shortage of skilled labor in the U.S. [1][4] Current Trends - Manufacturing activities expanded for the second consecutive month in February, with the Manufacturing PMI at 50.3%, although this is a decline from January's 50.9% [4] - The New Orders Index fell to 48.6%, indicating contraction as customers remain cautious amid market volatility and tariff-related risks [4] - Rising input costs and supply-chain disruptions are negatively impacting profitability, with the Supplier Deliveries Index showing slower deliveries for three consecutive months [5] Company Performance - Companies like Dover Corporation, RBC Bearings, Applied Industrial Technologies, and DNOW Inc. are focusing on cost-control measures and product development to remain competitive [2] - RBC Bearings reported a 15.5% year-over-year revenue increase in its Aerospace & Defense segment, with a robust backlog of $896.5 million [17] - DNOW has seen a 10.3% increase in earnings estimates to 86 cents per share for 2025, benefiting from steady demand in energy markets [22] - Dover's earnings estimates have increased by 1.3% to $9.46 per share for 2025, with positive booking growth across segments [25] - Applied Industrial Technologies anticipates a 1-3% year-over-year sales growth for fiscal 2025, with earnings estimates rising to $9.90 per share [30] Market Performance - The Zacks Manufacturing – General Industrial industry has declined by 6.7% over the past year, underperforming the broader sector's decline of 7.6%, while the S&P 500 index grew by 9.3% [9] - The industry's current forward 12-month Price-to-Earnings (P/E) ratio is 20.31X, slightly below the S&P 500's 20.92X and above the sector's 18.17X [12]