There are lots of signs that the U.S. economy is gaining some momentum, and we are nearing a period of much stronger growth. We saw gross domestic product revised to a 4.6% pace, and recent reports show that the labor market is also getting better.
If you dig down into the durable goods report, you’d find that the U.S. manufacturing sector is healthy, and business investment remains very strong. The consumer is a little more upbeat as we head into the important final quarter shopping season. Things are picking up, which means that cyclical companies that are sensitive to the economic could be poised to shine.
To increase your odds of picking the right stocks for a cyclical upturn use Portfolio Grader to find those stocks with the very best fundamentals to lead the market higher.
Here are three strong stocks to buy in cyclical industries:
Westlake Chemical (WLK)
Westlake Chemical (WLK) is an example of a company that will benefit from a stronger economy but is already performing at a high level.
Westlake Chemical makes basic chemicals, vinyls, polymers and fabricated building products that are used in industries like packaging, automotive products, coatings and construction. So, Westlake Chemical will see a huge pick up in business as the economy recovers.
Westlake Chemical is already doing well with earnings up over 50% this year, and sales and profit growth should accelerate as the economy improves. Analysts have noted the potential for Westlake and have been raising estimates for 2014 and 2015.
Portfolio grader upgraded WLK stock to an “A” back in May, and Westlake is still a “strong buy.”
Century Aluminum (CENX)
Estimates for Century Aluminum (CENX) have also been rising rapidly. Century produces and sells primary aluminum in the U.S. and Iceland, and business is pretty good with earnings up more than 100% this year.
Analysts are expecting even larger gains this year with solid sales growth and improved pricing allowing Century Aluminum to reverse last year’s loss and post solid profits in 2015.
CENX stock was raised to an “A” by Portfolio Grader in August, and Century Aluminum stock is a “strong buy” at the current price.
C&J Energy Services (CJES)
C&J Energy Services (CJES) provides hydraulic fracturing, coiled tubing and wireline services to oil and gas exploration and production companies in the U.S. Although activity has fallen off a bit in the shale fields due to lower oil prices and excess supplies C&J Energy has continued to perform well in spite of sector weakness.
C&J Energy has posted two consecutive earnings surprises, and we should see more in the future as the economy drives new demand for oil and gas. Portfolio Grader upgraded CES stock to an “A” last week, and C&J Energy is a “strong buy” right now.
The economy is getting strong, and that is going to spark improvements in cyclical industries. Make sure you use Portfolio Grader so that your portfolio is poised to participate with the very best stocks.
More From InvestorPlace
- 3 Robust Stocks Worth the High Prices
- Count on Jamba to Juice Your Portfolio
- 4 ETFs to Expose Your Portfolio to Emerging Markets
Louis Navellier is a renowned growth investor. He is the editor of five investing newsletters: Blue Chip Growth, Emerging Growth, Ultimate Growth, Family Trust and Platinum Growth. His most popular service, Blue Chip Growth, has a track record of beating the market 3:1 over the last 14 years. He uses a combination of quantitative and fundamental analysis to identify market-beating stocks. Mr. Navellier has made his proven formula accessible to investors via his free, online stock rating tool, PortfolioGrader.com. Louis Navellier may hold some of the aforementioned securities in one or more of his newsletters.
