The U.S. presidential election is heating up. After months of relative stability, there has been a ton of breaking news in the past few weeks, and the betting markets and prediction models are swinging toward former President Trump.
The Economist’s forecast, for example, shows that Trump has a roughly 83% chance of winning the election as of July 18th. There are still months before election day and a lot can happen. Regardless, investors are understandably considering the possibility of a major Republican victory in November.
In addition, last week, Trump announced that he had selected Ohio senator J.D. Vance as his vice-presidential pick. Vance is known for being a China skeptic and supporter of American manufacturing initiatives.
Particularly now that Vance is on the ticket, investors should consider the possibility of an American manufacturing boom over the next four years. These American automation stocks should enjoy supercharged results in the future.
Rockwell Automation (ROK)
For investors betting on American automation solutions, Rockwell Automation (NYSE:ROK) should be near the top of their shopping lists.
In fact, Morningstar’s Brian Bernard recently wrote, “We view Rockwell as the highest-quality automation player on the west side of the Atlantic based on quality, breadth of offerings and shrewd strategic partnerships.”
Bernard is particularly enthusiastic about the company’s Logix platform, which offers programmable controllers that support Rockwell and third-party automation solutions.
Logix is broadly applicable and can serve several different industrial processes, making it easy for large companies to control multiple discrete applications within one system. The platform’s support for cloud analytics also makes it easier for companies to deploy predictive maintenance solutions, which reduces costs and improves efficiency.
ROK stock has dropped more than 20% over the past year as investors fret about a potential economic slowdown and reduced capital expenditures due to high interest rates. However, a Trump/Vance presidency could quickly reverse those trends. In the meantime, Bernard believes shares are attractively priced at a 14% discount to fair value today.
Columbus McKinnon (CMCO)
Columbus McKinnon (NASDAQ:CMCO) is another great American automation stock to buy now.
The firm offers a wide array of equipment and components needed to build automated factories and warehouses. Since the onset of the pandemic, companies have spent a tremendous amount as they rush to deploy improved logistics systems to support e-commerce.
Right now, that trend has abated a bit due to macroeconomic concerns and the higher cost of borrowing money. However, there is little doubt that e-commerce will continue to grow in the long term, driving a greater need for smart warehouses. Additionally, Amazon (NASDAQ:AMZN) has invested heavily in warehouse robotics, forcing the whole industry to build automation solutions to keep up.
With a potential Trump presidency, smart factories could gain momentum to help deliver on the “Made in America” theme. That would further lift demand for Columbus McKinnon’s conveyor belts, hoists, rigging tools and motion control systems, which improve manufacturing process efficiency.
CMCO stock bounced over the past two weeks as traders started accounting for the shifting political winds. Still, the company is more than reasonably priced at just 12 times forward earnings.
Cognex (CGNX)
Cognex (NASDAQ:CGNX) is an intriguing pick within the American automation space, as it has multiple ways to win against current trends.
The company is heavily involved in smart factories and warehouses. It’s a leader in the fixed-mount barcode reader market, which allows retailers to scan items and check customers with fewer human cashiers. Cognex also has a small but fast-growing business providing machine vision solutions for semiconductor fabrication.
Cognex delivers both organic growth and an ambitious mergers and acquisitions strategy. Last year, it bought Japanese machine vision optics firm Moritex for about $275 million. This was the largest deal in Cognex’s history, building on the firm’s prior purchase of Sirius Advanced Cybernetics.
CGNX stock has had a volatile ride over the past year. Amazon, a key customer, dramatically slowed down spending on its logistics operations as it adjusts to new post-pandemic economic conditions. Cognex’s sales in the auto market decelerated as the market struggled due to high interest rates.
However, given Cognex’s multiple exciting business opportunities, any improvement in sentiment — such as a potential Trump win this fall — could get shares moving once again.
On the date of publication, Ian Bezek held a long position in CMCO stock. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
