Considering factors as disparate as a housing market that appears to be on the rebound (in the United States at least), combined with dramatically increasing global need for infrastructure spending in both developed and developing countries, the industrial goods sector has a number of companies that can be extremely relevant to the future demands that are implied by these trends.
The following six stocks from the industrial goods sector have been chosen based on their small to mid-cap size (between $300 million and $10 billion), high average annual sales growth over the past five years (exceeding 25 percent), a current quarterly performance over 13 percent, and projected earnings-per-share growth for the next year greater than 13 percent.
Based on this information, it is a plausible thesis that these companies are likely to continue on their current growth trajectories, and might present profitable investment opportunities in the mid-to-long terms.
Colfax Corp. (CFX) – The Maryland-based industrial machinery company specializing in fluid-handling has a market cap of $4.03 billion and is currently trading at $42.79 per share. For the present quarter, shares have gained 13.5 percent, and the company has posted an average 50.54 percent sales increase over the past five years, and EPS growth for the next year projected at 30.05 percent.
Mas Tec, Inc. (MTZ) – The heavy construction company specializes in complex infrastructure projects has its headquarters in Coral Gables, Florida. Their market cap puts it on the low end of the mid-cap spectrum at $2.29 billion, with stocks currently trading at $30.20 per share. Mas Tec's stock is up 30.1 percent over the past quarter, and the company sports a trailing five-year sales growth of 26.19 percent, and EPS growth for the next year projected at 25.83 percent.
HollySys Automation Technologies Ltd. (HOLI) – The Chinese industrial-electrical provider of automation and control technologies has a market cap of $694.96 million, with shares trading at $12.41. HOLI’s return for the present quarter is 21.31 percent, with sales having grown 25.58 percent over the past five years, and EPS growth for the next year projected at 13.89 percent.
Proto Labs, Inc. (PRLB) – The Maple Plain, Minnesota machine tools and accessories manufacturer has a market cap of $1.13 billion, with shares trading at $46.41. Shares are up in the current quarter by 30.7 percent, with the company's sales having grown 28.53 percent over the past five years, and EPS growth for the next year estimated at 26.15 percent.
Gafisa S.A. (GFA) – The Brazilian residential construction company has a market cap of $942.24 million, with shares trading at $4.35. Shares have gained 18.21 percent for the last quarter, with sales over the past five years having grown 35.32 percent, and an EPS growth for next year projected at a gigantic 3,500 percent.
Energy Solutions, Inc. (ES) – The Salt Lake City, Utah-based waste management company has a market cap of $337.57 million, with shares currently trading at $3.74. It's up 20.6 percent for the quarter, with a sales growth over the past five years of 33.57 percent, and a projected EPS growth for the next year of $337.57 million.
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