Market fluctuations create buying opportunities for long-term investors, whether they are adding to an existing position or initiating a new one. The industrial sector has been somewhat weak of late, so I thought I'd outline five long-term growth stocks that have dipped recently.

They include industrial giant General Electric (GE 0.82%), toolmaker Stanley Black & Decker, (SWK 1.50%) and mid-cap options nVent (NVT 1.78%), Univar (UNVR), and Pentair (PNR 1.46%).

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General Electric

A quick look at these stock performances versus the S&P 500 index shows a relatively good performance on a year-to-date basis, but there's no denying the dip in recent weeks.

SWK Chart

Data by YCharts

There doesn't appear to be any unifying theme in the sell-off, other than a general rotation out of industrial stocks by institutional investors.

 However, retail investors don't have to get involved in the constant game of guessing which sector is hot this quarter. That's a consideration that comes to mind when thinking about GE.

In recent weeks, CEO Larry Culp has been vocal in outlining the company's medium-term earnings and free cash flow (FCF) generation aims, and what he had to say is very positive. In a nutshell, Culp believes $7 billion in FCF is possible by 2023. Culp's plans involve aviation making a strong recovery to 2019 levels of profitability, healthcare continuing to churn out FCF, and restructuring actions at power leading to a solid contribution of $1 billion to $2 billion. Meanwhile, GE Renewable Energy should have a $3 billion offshore wind business by 2023 and support ongoing growth in onshore wind.

Wind turbines.

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If GE hits $7 billion in FCF in 2023, it will trade (based on its current market cap) on 16.3 times its FCF. That would be an excellent valuation for a company with a long-term growth opportunity from servicing its installed base of aircraft engines, gas turbines, and wind turbines.

Pentair and nVent

Continuing the discussion of FCF leads us to electrical products company nVent Electric and residential and commercial water treatment company Pentair. However, investors should not think of these two stocks as merely being value investing options because they both have decent growth prospects.

PNR Price to Free Cash Flow Chart

Data by YCharts

nVent is a manufacturer of electrical enclosures, fastening solutions, and electric thermal management solutions. It's a solid, albeit unexciting, market, but that's the point! nVent's solutions make up a relatively small part of its customers' project expenditures -- suggesting that it goes under the radar when customers focus on cost-cutting measures. That makes it a useful way to play the "electrification" of the economy, whether spending on automation, smart grids, data centers, electrifying buildings, or transportation.

Pentair's consumer solutions business (pool equipment and home water treatment) received a boost in 2020 as the stay-at-home measures created a boom in spending on home and garden. There were 100,000 new pools built in North America in 2020. Moreover, given that the pool equipment market is primarily replacement, it's likely that the company has a long-term opportunity to sell into the existing pool base of 5.3 million pools in North America.

Meanwhile, management expects its industrial and flow technologies segment to grow at a low-single-digit rate over the long term. It all adds up to a business growing revenue at a mid-single-digit rate and earnings at a double-digit rate. Management expects $2.5 billion in FCF in the 2022-2025 timeframe. Given that the current market cap is only $10.95 billion, it suggests the company is undervalued.

Univar and Stanley Black & Decker

Univar is the value play, and Stanley Black & Decker is the hidden growth stock. The case for specialty chemicals distributor Univar rests on the idea that management's refocusing on its core activity, specialty chemical distribution, will pay off. Management aims to raise profit margin to a level similar to one of its peers in North America by 2022.

To get to earnings before interest, taxation, depreciation, and amortization (EBITDA) margin of 9% by 2022 (the stated aim of its so-called "S22 Program"), management plans to streamline the company, cut costs, and invest in digital technologies to improve distribution.

Given that analysts are forecasting $9.4 billion in sales in 2023, Univar could be generating $845 million in EBITDA then. Based on the current enterprise value, or EV (market cap plus net debt) of $6.2 billion, Univar could trade on an EV/EBITDA multiple of just 7.3 times EBITDA in 2023. That would make the stock an excellent value.

A person doing a DIY project at home.

Image source: Getty Images.

Finally, Stanley Black & Decker's growth prospects often fall under the radar. The pandemic boosted its DIY power tools sales, and the housing boom will help its professional tools sales.

Meanwhile, Stanley's leadership in e-commerce helped it win market share during the pandemic. The movement toward electric vehicles should raise the content per vehicle amount for Stanley's fasteners and fittings. Moreover, the company has an exciting growth opportunity to expand in the complementary lawn and garden sector through its option to purchase the remaining share of MTD. 

All told, Stanley looks capable of achieving its management's long-term aims of double-digit earnings growth, and trading on 16 times next year's estimated earnings, the stock remains attractive.