The Zacks Manufacturing-Tools & Related Products industry is projected to grow, driven by robust demand for machinery tools in the industrial and automotive sectors. As of December 2024, the Institute for Supply Management’s manufacturing index indicated a contraction at 49.3%, marking nine consecutive months of decline, yet an uptick in new orders was reported at 52.5%, reflecting a 2.1 percentage point increase from November.
Key industry players include Stanley Black & Decker, Inc. (SWK), Core & Main, Inc. (CNM), Lincoln Electric Holdings (LECO), and Kennametal Inc. (KMT), all positioned to leverage growth opportunities through innovation, acquisitions, and increasing demand for manufacturing tools. The industry currently holds a Zacks Industry Rank of #84, placing it in the top 34% of over 250 industries.
In terms of valuation, the industry is trading at a forward Price-to-Earnings (P/E) ratio of 18.95X, below the S&P 500’s 22.33X and the sector’s 19.65X. Over the past year, the industry has seen a modest appreciation of 3.1%, significantly lagging behind the S&P 500, which grew by 26.4% during the same period.
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