SPECIAL REPORT The Top 7 Stocks for 2024

The 3 Best Manufacturing Stocks to Buy in August

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  • Hedge your bets with the best manufacturing stocks to buy.
  • Cummins (CMI): Cummins’ industrial machinery helps undergird multiple sectors.
  • Emerson Electric (EMR): Emerson offers infrastructural products and services.
  • CNH Industrial (CNHI): CNH Industrial is critical to the agricultural space.
Best Manufacturing Stocks to Buy - The 3 Best Manufacturing Stocks to Buy in August

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While even the best manufacturing stocks to buy probably won’t add much excitement to the space, investors should still consider the slow but steady opportunity here. Yes, I get it. In a world where artificial intelligence is rapidly taking over everything that we do, it almost seems silly to waste your time with leading manufacturing stocks. Here are some of the reasons why you’re wrong.

First, high-potential manufacturing stocks probably command permanent relevance. That’s because – speaking of the devil – AI will likely never replace manufacturing functions. Sure, digital intelligence can replace most jobs with a narrow focus, such as customer service for a consumer discretionary retailer. But to replicate the specialized industriousness and ingenuity of highly skilled human workers? That’s a bit much.

Second, these must-buy manufacturing stocks are incredibly reliable. With the population expanding through natural means and immigration, the manufacturing sector will continue to run, irrespective of the economy (within reason of course). As a result, the segment provides a hedge against more exciting but riskier industries.

On that note, below are the top manufacturing stocks for August.

Cummins (CMI)

A Cummins sign in bright red.
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A multinational company that designs, manufactures and distributes engines, filtration and power generation products, Cummins (NYSE:CMI) might not sound like the most riveting enterprise available. Still, it makes arguably a great case for best manufacturing stocks to buy. As a specialist in diesel engines, Cummins undergirds multiple industries, including transportation, construction, agriculture and mining.

If you anticipate those sectors fading into irrelevance, then CMI might not be viable. Otherwise, it should be on your radar for top manufacturing stocks for August. Another powerful catalyst for CMI centers on its passive income. Right now, the company carries a forward yield of 2.83%, slightly above the industrial sector’s average yield of 2.36%. Also, its payout ratio sits at a lowly 34.16%, providing higher confidence for yield sustainability.

Finally, Wall Street analysts peg CMI as a consensus moderate buy. This assessment breaks down as four buys, six holds and zero sells. On average, the experts’ price target lands at $264.64, implying almost 12% upside potential. Again, it’s a great candidate for must-buy manufacturing stocks.

Emerson Electric (EMR)

An office building with an Emerson Electric sign on it.
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Headquartered in Ferguson, Missouri, Emerson Electric (NYSE:EMR) manufactures products and provides engineering services for industrial, commercial and consumer markets. Emerson provides a wide range of products and services, including automation and control software, safety systems and piping solutions related to valves, actuators and regulators. As a sort of stagehand investment, you probably can’t go wrong with EMR as one of the best manufacturing stocks to buy.

As well, Emerson offers an extremely reliable enterprise for investors worried about economic jitters. In particular, the company offers a forward yield of 2.18%. Granted, that’s nothing to write home about. However, it commands 66 years of consecutive dividend increases. Also, its payout ratio sits at 42.65%, which is a very reasonable figure.

Lastly, the Street pegs EMR as a consensus moderate buy. This assessment breaks down as six buys, three holds and zero sells. On average, the experts’ price target hits $106.78, implying nearly 12% upside potential. Thus, it’s one of the leading manufacturing stocks if you’re looking for a balanced approach to the market.

CNH Industrial (CNHI)

A magnifying glass is focused on the logo for CNH Industrial on the company's website.
Source: Pavel Kapysh / Shutterstock.com

An Italian-American multinational corporation, CNH Industrial (NYSE:CNHI) designs, produces and sells agricultural machinery and construction equipment, per its public profile. While it might not be the most exciting idea, it’s incredibly relevant. According to Mordor Intelligence, the agricultural machinery market may hit a valuation of $65.47 billion this year. By 2028, the segment could reach $85.16 billion.

Like the other ideas for best manufacturing stocks to buy, CNH offers passive income. Right now, the company commands a forward yield of 2.82%. Again, this stat runs higher than the industrial sector’s average yield of 2.36%. Further, the payout ratio sits at a subterranean 21.35%. Therefore, stakeholders shouldn’t have to worry much about yield sustainability.

In closing, analysts peg CNHI as a consensus moderate buy. This assessment breaks down as five buys, three holds and zero sells. Notably, the experts’ average price target stands at $17.20, implying 23% upside potential. In other words, it’s easily one of the high-potential manufacturing stocks.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.


Article printed from InvestorPlace Media, https://investorplace.com/2023/08/the-3-best-manufacturing-stocks-to-buy-in-august/.

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