2 Industrials Stocks with Solid Fundamentals and 1 We Ignore

Barchart·03/27/2026 04:12:13

Industrials businesses quietly power the physical things we depend on, from cars and homes to e-commerce infrastructure. Their momentum is also rising as lower interest rates have incentivized higher capital spending, and as a result, the industry has posted a six-month gain of 5.1%. This was a good place to be as the S&P 500 shed 1% of its value.

Nevertheless, investors must be mindful as the cycle can unexpectedly turn. When this inevitably happens, only the elite companies will survive and ultimately thrive. With that said, here are two industrials stocks boasting durable advantages and one that may face trouble.

One Industrials Stock to Sell:

C.H. Robinson Worldwide (CHRW)

Market Cap: $19.76 billion

Engaging in contracts with tens of thousands of transportation companies, C.H. Robinson (NASDAQ:CHRW) offers freight transportation and logistics services.

Why Does CHRW Fall Short?

1. Sales tumbled by 4% annually over the last two years, showing market trends are working against its favor during this cycle
2. Competitive supply chain dynamics and steep production costs are reflected in its low gross margin of 7.4%
3. Diminishing returns on capital suggest its earlier profit pools are drying up

C.H. Robinson Worldwide is trading at $169.16 per share, or 28x forward P/E. Check out our free in-depth research report to learn more about why CHRW doesn’t pass our bar.

Two Industrials Stocks to Watch:

Vertiv (VRT)

Market Cap: $96.57 billion

Formerly part of Emerson Electric, Vertiv (NYSE:VRT) manufactures and services infrastructure technology products for data centers and communication networks.

Why Will VRT Beat the Market?

1. Core business is healthy and doesn’t need acquisitions to boost sales as its organic revenue growth averaged 21.9% over the past two years
2. Free cash flow margin increased by 16 percentage points over the last five years, giving the company more capital to invest or return to shareholders
3. Returns on capital are growing as management capitalizes on its market opportunities

At $256.75 per share, Vertiv trades at 45x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.

Wabtec (WAB)

Market Cap: $41.87 billion

Also known as Wabtec, Westinghouse Air Brake Technologies (NYSE:WAB) provides equipment, systems, and related software for the railway industry.

Why Do We Like WAB?

1. Operating margin improvement of 4.9 percentage points over the last five years demonstrates its ability to scale efficiently
2. Share buybacks catapulted its annual earnings per share growth to 23%, which outperformed its revenue gains over the last two years
3. WAB is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders, and its recently improved profitability means it has even more resources to invest or distribute

Wabtec’s stock price of $245.47 implies a valuation ratio of 24x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.

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