1 Mooning Industrials Stock with Exciting Potential and 2 We Ignore

Barchart·05/22/2026 03:18:23

Each stock in this article is trading near its 52-week high. These elevated prices usually indicate some degree of investor confidence, business improvements, or favorable market conditions.

While momentum can be a leading indicator, it has burned many investors as it doesn’t always correlate with long-term success. Keeping that in mind, here is one stock with the fundamentals to back up its performance and two best left ignored.

Two Industrials Stocks to Sell:

RXO (RXO)

One-Month Return: +29.3%

With access to millions of trucks, RXO (NYSE:RXO) offers full-truckload, less-than-truckload, and last-mile deliveries.

Why Do We Avoid RXO?

1. Declining unit sales over the past two years suggest it might have to lower prices to accelerate growth
2. Shrinking returns on capital from an already weak position reveal that neither previous nor ongoing investments are yielding the desired results
3. Limited cash reserves may force the company to seek unfavorable financing terms that could dilute shareholders

RXO is trading at $24.74 per share, or 174.9x forward P/E. Dive into our free research report to see why there are better opportunities than RXO.

Landstar (LSTR)

One-Month Return: +7.8%

Covering billions of miles throughout North America, Landstar (NASDAQ:LSTR) is a transportation company specializing in freight and last-mile delivery services.

Why Should You Dump LSTR?

1. Sales tumbled by 2.8% annually over the last two years, showing market trends are working against its favor during this cycle
2. Incremental sales over the last five years were much less profitable as its earnings per share fell by 8.1% annually while its revenue grew
3. Waning returns on capital imply its previous profit engines are losing steam

At $191.20 per share, Landstar trades at 31.9x forward P/E. Read our free research report to see why you should think twice about including LSTR in your portfolio.

One Industrials Stock to Watch:

Valmont (VMI)

One-Month Return: +8.6%

Credited with an invention in the 1950s that improved crop yields, Valmont (NYSE:VMI) provides engineered products and infrastructure services for the agricultural industry.

Why Are We Positive On VMI?

1. Operating profits increased over the last five years as the company gained some leverage on its fixed costs and became more efficient
2. Earnings per share grew by 57.6% annually over the last two years, massively outpacing its peers
3. Free cash flow margin grew by 10.2 percentage points over the last five years, giving the company more chips to play with

Valmont’s stock price of $506.93 implies a valuation ratio of 2.3x forward price-to-sales. Is now a good time to buy? Find out in our full research report, it’s free.

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