MW These 10 industrial stocks look ripe as investors rotate toward the sector
By Philip van Doorn
Analysts favor many sector names for rapid sales growth and big gains for the stocks over the next year
Analysts expect Uber to increase its revenue at an annual pace of 14% through 2027. They see 43% upside for the stock over the next 12 months.
The stock market's day-to-day narrative can change on a dime, and this week's theme of a pullback in precious metals and bitcoin continued early on Thursday. Let's set the stage for a stock screen by looking at a summary of weighted price changes for the S&P 500's sectors.
Through Wednesday, the S&P 500 SPX was up for 0.5% for 2026, excluding dividends, despite significant pullbacks for some of its components with the heaviest weightings. For example, shares of Microsoft $(MSFT)$ stock were down 14.4% year-to-date. The company makes up 5.2% of the $706 billion SPDR S&P 500 ETF Trust SPY, which tracks the S&P 500 by holding all of its stocks. The exchange-traded fund, like the index, is weighted by market capitalization.
Related: These hot S&P 500 stocks show where investors are heading as they run away from tech
Now let's take a look at how the 11 sectors of the S&P 500 have performed this year through Wednesday. All price changes in this article exclude dividends.
The S&P 500's information-technology sector was down 5.2% for 2026 through Feb. 5, while the full S&P 500 was up 0.5% year-to-date.
Most of the sectors were up for 2026. Looking at this year's best performers so far, the energy, materials and consumer staples sectors all underperformed the full S&P 500's 16.4% gain in 2025. But the industrial sector was up 9.2% for 2026 following a 17.7% gain in 2025.
An investor can easily ride the industrial sector with an exchange-traded fund. For example, the State Street Industrial Select Sector SPDR ETF XLI tracks the S&P 500 industrial sector by holding all of its stocks weighted by market cap.
But what if you want to hold some individual industrial names for long-term growth?
For a related stock screen, we began with the 80 companies in the S&P 500 industrial sector and examined projected compound annual growth rates (CAGR) for revenue from 2025 through 2027. The projections are based on consensus estimates among analysts working in brokerage and research firms polled by LSEG, with adjustments for companies whose fiscal reporting periods don't match the calendar.
These 10 stocks in the S&P 500's industrial sector have the highest projected revenue CAGR for two years through 2027. A summary of analysts' consensus price targets and ratings is to the right. You might need to scroll the table or flip your screen to landscape to see all of the data.
Company Two-year est. sales CAGR through 2027 Est. 2026 sales growth June 5 price Cons. price target Implied 12-month upside potential Share "buy" ratings Axon Enterprise Inc. 25.0% 25.7% $430.65 $788.70 83% 95% GE Vernova Inc. 14.7% 16.0% $746.22 $827.96 11% 83% Uber Technologies Inc. 14.0% 13.2% $73.92 $106.02 43% 85% Comfort Systems USA Inc. 13.0% 15.7% $1,119.81 $1,089.43 -3% 78% Quanta Services Inc. 12.1% 12.3% $464.57 $475.57 2% 66% General Aerospace 11.8% 13.7% $308.34 $355.09 15% 86% Boeing Co. 11.4% 8.3% $235.95 $271.61 15% 83% Howmet Aerospace Inc. 11.0% 11.5% $208.61 $240.82 15% 84% Generac Holdings Inc. 10.1% 10.2% $177.18 $203.03 15% 74% Equifax Inc. 9.7% 9.6% $181.04 $250.58 38% 64% Source: LSEG
Axon Enterprise (AXON) tops the list with a projected revenue CAGR of 83% for two calendar years through 2027. In November, the company reported a 31% in third-quarter revenue from a year earlier. Sales of connected devices, including Tasers and personal sensors, were up 23.6%, while sales of software and services increased 41%.
Axon also has the highest percentage of buy or equivalent ratings among the 10 companies on the list, according to analysts polled by LSEG, along with the most aggressive consensus price targets. Most analysts working for brokerage and research firms (known as "sell-side" analysts) set 12-month price targets.
Uber Technologies UBER ranks third on the list with a projected revenue CAGR of 14%, but it has the second-most-aggressive consensus sales target, implying 43% upside potential over the next year.
Some of the companies may appear to be fully valued based on the price targets. However, one year might be considered a short period for a committed long-term investor.
You should do your own research to form your own opinion about a company's long-term business strategy before buying an individual stock. One way to begin that process is to click on the tickers for more information.
Read: Tomi Kilgore's guide to the wealth of information available for free on the MarketWatch quote page.
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-Philip van Doorn
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February 05, 2026 12:14 ET (17:14 GMT)
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