As the resumption in economic activities and construction works boosts industrial production, the sector is gradually recovering from its pandemic-induced downturn. This, along with the government’s infrastructure spending plans, bode well for fundamentally strong industrial stocks Granite Construction (NYSE:GVA) and Heritage-Crystal (HCCI). They possess solid growth potential, and we think are poised to see their shares soar in price in the near term. Read on.A faster-than-expected economic recovery from the depths of the COVID-19 pandemic-induced recession, coupled with the resumption of construction activities and growing demand from the manufacturing sector, are contributing to the industrial sector’s rebound. According to Federal Reserve data, total industrial production in August rose 5.9% year-over-year.
Investor optimism surrounding the industrial sector’s prospects is evidenced by the Industrial Select Sector SPDR Fund’s (XLI) 26.9% returns over the past year. Furthermore, President Biden’s bipartisan infrastructure bill proposal, which is expected to be passed at the end of this month, should bolster the demand for industrial goods.
Given this backdrop, we think it could be wise to bet now on prominent industrial stocks Granite Construction Incorporated (GVA) and Heritage-Crystal Clean, Inc (NASDAQ:HCCI). These stocks are expected to continue rallying in price due to their strong growth potential and stable financials.