3 Industrial Names That Will Benefit from Rising CapEx in 2026

Core Insights - Industrial stocks demonstrated strong performance in 2025, with the Vanguard Industrials ETF increasing over 21%, surpassing the S&P 500's return of around 16% [3] - Sustained capital expenditure (CapEx) spending is expected to support the industrial sector's growth into 2026, driven by long-term infrastructure investments [3][5] - The Infrastructure Investment and Jobs Act has broadened the definition of infrastructure, leading to elevated industrial demand across various sectors [3] CapEx Trends - CapEx spending is shifting from cyclical to systemic, supported by regulatory mandates, national security priorities, and long-term contracts with utility companies and governments [5] - This systemic nature of spending provides investors with a clearer revenue and earnings outlook that extends over several years, regardless of broader economic conditions [5] Sector Developments - Industrial spending is expanding beyond traditional areas like roads and bridges to include grid upgrades, reshoring, and data center construction, enhancing revenue visibility [7] - Companies like Emerson Electric Co. are positioned for steady earnings growth due to their automation portfolios and favorable profit outlooks for fiscal 2026 [7] - Fluor and Johnson Controls are also reinforcing the long-duration CapEx theme with their project backlogs and pipelines [7][8]