Please ensure Javascript is enabled for purposes of website accessibility

6 Top Manufacturing Power Players

By Vad Yazvinski - Updated Apr 5, 2017 at 8:03PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

A U.S. industry thought nearly dead could be headed for a comeback.

"A business that makes nothing but money is a poor business."
-- Henry Ford

The TV has probably informed you on many occasions that all "manufacturing is dead in America" -- and that soon, we won't even have any factories left here in the United States. With the Big Three automakers' plea for a huge government bailout still dominating the news, these claims will likely only get louder in the short run. But surprisingly enough, according to a 2006 report by the National Association of Manufacturers, U.S. manufacturing all on its own would still represent the world's eighth-largest economy!

Producing tangible goods instead of trading financial papers has somehow become both lower-paid and less desirable for American workers. Very few newly minted Ivy League MBAs now consider Ford or GM a dream destination; instead, they spend most of their job-hunting efforts trying to land the corner office on Wall Street.

But with the giant stimulus package coming out, and the with the U.S. dollar still relatively weak compared to its peak levels of 2000 to 2001, the tide seems to be turning away from less tangible sectors like investment banking, and toward companies that actually make and sell goods. This transition won't happen overnight, but we might all be surprised one day to find "production manager" as high on an MBA's wish list as "investment banker" is today.

Fortunately for fellow Fools, the CAPS screener can help us get ahead of the curve, identifying key players in this transition that, unlike General Electric (NYSE:GE) and its potentially diminishing returns, should still have room to grow. We'll look for "investment grade" four- and five-star names in the industrial-goods sectors that have grown their earnings by at least 10% over the last tyhree years, carry low debt, and have increased their market caps over the last 4 weeks thus greatly outperforming the overall market.

Here's the actual screening criteria:

  • Sector: Industrial goods
  • Top CAPS ratings of four or five stars
  • Market cap of $150 million to $50 billion
  • Low debt/equity ratios of 0 to 0.5 times
  • EPS Growth rate (last 3 years) > 10%
  • Four-week price change of more than 1%

Below are six names of the more than 40 that made the cut.

Company Name

LT Debt-to-Equity Ratio

4 Week Price Change %

EPS Growth Rate (last 3 Yrs)

Astec Industries (NASDAQ:ASTE)

0

43.6%

28.38%

Esterline Technologies (NYSE:ESL)

0.33

18.4%

13.03%

Fluor (NYSE:FLR)

0.01

42.6%

45.94%

Lincoln Electric (NASDAQ:LECO)

0.07

20.8%

23.31%

Manitowoc (NYSE:MTW)

0.13

27.2%

68.81%

Parker Hannifin (NYSE:PH)

0.4

8.5%

16.01%

Source: Motley Fool CAPS. Dates for price change: Nov. 14, 2008 to Dec. 8, 2008.

Of course, this screen is only a starting point in the research process; the CAPS screener can help you narrow your choices even further. While you might not have a lot of time to spare in analyzing these players, many of our All-Stars have already done the initial work for you. Join us in Motley Fool CAPS to delve into their commentaries, and let our 120,000-strong (and growing) CAPS community help you sift through the rubble in search of the next few great investing ideas.

An assembly line of further Foolishness:

Fool contributor Vad Yazvinski, the "Skeptical Capitalist," owns none of the companies mentioned. The Fool's disclosure policy is always on the menu.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

General Electric Company Stock Quote
General Electric Company
GE
$75.18 (1.10%) $0.82
Parker-Hannifin Corporation Stock Quote
Parker-Hannifin Corporation
PH
$292.55 (-0.09%) $0.27
Fluor Corporation Stock Quote
Fluor Corporation
FLR
$24.53 (6.28%) $1.45
The Manitowoc Company, Inc. Stock Quote
The Manitowoc Company, Inc.
MTW
$10.90 (-3.11%) $0.35
Lincoln Electric Holdings, Inc. Stock Quote
Lincoln Electric Holdings, Inc.
LECO
$141.90 (-0.50%) $0.71
Astec Industries, Inc. Stock Quote
Astec Industries, Inc.
ASTE
$41.90 (-0.99%) $0.42
Esterline Technologies Corporation Stock Quote
Esterline Technologies Corporation
ESL

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
377%
 
S&P 500 Returns
123%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 08/08/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.