On February 12, Thomson Reuters released its 2026 Global Trade Report, and the findings paint a clear picture of an industry navigating serious headwinds. Global trade is under pressure, and the numbers make it hard to ignore. Tariff volatility is the biggest story. Nearly three-quarters of trade professionals surveyed flagged U.S. tariffs as the most disruptive regulatory change this year, up sharply from 41% just a year ago. Supply chain concerns have almost doubled over the same period, with companies now treating issues like supplier reliability and customs delays as full-blown enterprise risks, not just operational hiccups.
The cost pressure is real, too. Many companies are being forced to choose between raising prices or taking a hit on their margins; neither is a comfortable position. But where there’s disruption, there’s also opportunity. Companies that can navigate this environment efficiently are becoming increasingly valuable, and investors are starting to take notice.
So which trading and distribution stocks are worth watching right now? Here’s a look at our 10 Best Trading and Distribution Stocks to Buy.
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Our Methodology
To identify relevant stocks for this article, we screened U.S.-listed trading and distribution companies with market capitalizations above $2 billion. Next, we shortlisted stocks with at least 15% upside potential. Finally, we selected 10 stocks with the highest upside and ranked them in ascending order.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).
10. GATX Corp. (NYSE:GATX)
GATX Corp. (NYSE:GATX) is one of the 10 best trading and distribution stocks to buy.
On February 24, Citigroup downgraded GATX Corp. (NYSE:GATX) from a Buy rating to a Neutral rating. The firm raised the price target from $197 to $210, which now leads to a revised upside potential of almost 18%. The firm cited valuation as the primary reason for the downgrade, noting that the expected synergies from GATX Corp.’s (NYSE:GATX) joint venture with Brookfield appear to have already been reflected in the stock.
On February 20, Susquehanna increased the firm’s price target on GATX Corp. (NYSE:GATX) from $212 to $220. The firm maintained its Positive rating on the stock, which offers a revised upside potential of more than 23% at the prevailing level.
This upward adjustment in the target price reflects the firm’s continued confidence in the company’s market position. Susquehanna believes that the company continues to capitalize on the supply-constrained railcar market. Furthermore, it highlights that GATX Corp. (NYSE:GATX) maintains a unique opportunity and long-term visibility into fleet growth, characterized by attractive economics.
GATX Corp. (NYSE:GATX) is a global leader in railcar and engine leasing, providing essential transportation assets to industries like chemicals, energy, and agriculture. The company offers comprehensive maintenance and regulatory services for its rail fleet while also managing a diverse portfolio of commercial aircraft, spare engines, and specialized tank containers.
9. Ferguson Enterprises Inc. (NYSE:FERG)
Ferguson Enterprises Inc. (NYSE:FERG) is one of the 10 best trading and distribution stocks to buy.
On February 25, Truist increased the firm’s price target on Ferguson Enterprises Inc. (NYSE:FERG) from $260 to $300. The firm maintained its Buy rating on the shares, which offer an adjusted upside of more than 30% at the prevailing level. The firm noted that the company continues to deliver revenue growth, driven by strength in its non-residential businesses along with some contribution from inflation.
Truist added that demand from data center projects and other large-scale work has helped Ferguson’s growth stand out over the past year, though comparisons are now becoming more challenging. That said, the firm believes Ferguson’s ability to generate growth in tougher markets remains notable, supported by its combination of steady revenue gains and relatively low volatility.
On February 25, Scott Schneeberger from Oppenheimer increased the firm’s price target on Ferguson Enterprises Inc. (NYSE:FERG) to $280 from $255. The analyst maintained his Outperform rating on the stock, which yields a revised upside of more than 21%.
This adjustment follows the company’s fourth-quarter results, which exceeded expectations across all metrics. Schneeberger also reflected favorably upon the company’s earnings call, where management detailed strategic market opportunities and introduced a medium-term outlook.
Ferguson Enterprises Inc. (NYSE:FERG) is a distributor of specialized water and air solutions across North America. Serving both residential and commercial sectors, they provide critical products ranging from HVAC and plumbing to industrial pipe, valves, and fittings. Beyond hardware, they offer high-touch services like virtual design, fabrication, and project management to support complex infrastructure and industrial needs.
8. Rush Enterprises Inc. (NASDAQ:RUSHA)
Rush Enterprises Inc. (NASDAQ:RUSHA) is one of the 10 best trading and distribution stocks to buy.
On February 19, Stephens increased the firm’s price target on Rush Enterprises Inc. (NASDAQ:RUSHA) to $80 from $55 following the company’s fourth quarter results. The firm maintained an Overweight rating on the shares, which currently offer a revised upside potential of almost 23%.
Stephens noted that the results came in ahead of both its estimates and broader consensus expectations. The firm added that free cash flow generation remains strong across the freight cycle and expects Rush Enterprises Inc. (NASDAQ:RUSHA) to deploy that cash into accretive M&A, share repurchases, and dividends in fiscal 2026.
On February 18, Rush Enterprises Inc. (NASDAQ:RUSHA) reported Q4 revenue of $1.8 billion versus the consensus estimate of $1.7 billion. Chairman, CEO, and President W.M. “Rusty” Rush mentioned that, despite another challenging year in the commercial vehicle industry, he is proud of the company’s results in 2025.
The diversified business model, disciplined execution, and strategic investments contributed to the company’s profitability, its strong cash flow generation, and its continued shareholder returns.
Rush Enterprises Inc. (NASDAQ:RUSHA) operates a network of commercial vehicle dealerships, providing a comprehensive suite of sales and aftermarket services. They specialize in the retail of new and used vehicles, alongside critical support such as telematics, financing, and specialized maintenance. Their diverse offerings range from CNG fuel system installations to complex chassis upfitting for regional and national fleets.
7. Boise Cascade Co. (NYSE:BCC)
Boise Cascade Co. (NYSE:BCC) is one of the 10 best trading and distribution stocks to buy.
On February 25, Goldman Sachs increased its price target on Boise Cascade Co. (NYSE:BCC) from $85 to $94. The firm maintained a Neutral rating on the stock that offers a revised upside potential of more than 26% at the current level.
Boise Cascade Co. (NYSE:BCC) is well-positioned in 2026 to capitalize on company-specific initiatives, despite weak housing markets. The company is anticipating balanced BMD growth, the completion of the Thorsby i-line expansion, and stability in EWP pricing.
Some of the factors that are expected to drive long-term earnings momentum include operational controls, lean channel inventories, and efficient capital allocation. Despite these long-term tailwinds, there aren’t many short-term catalysts amid lower visibility on housing market recovery.
On February 24, Boise Cascade Co. (NYSE:BCC) reported fourth-quarter EPS of 24c, beating the street estimate of 12c, while revenue came in at $1.5 billion compared with the expectations of $1.45 billion. The firm noted that the quarter reflected typical seasonal softness in demand but still delivered solid operating results despite broader market headwinds.
Boise Cascade Co. (NYSE:BCC) is a manufacturer of engineered wood products, including I-joists and laminated veneer lumber, alongside structural plywood panels. Through an extensive wholesale distribution network, the company also supplies a broad array of building materials, such as siding, composite decking, and millwork, to support residential and commercial construction projects.
6. SiteOne Landscape Supply Inc. (NYSE:SITE)
SiteOne Landscape Supply Inc. (NYSE:SITE) is one of the 10 best trading and distribution stocks to buy.
On February 12, RBC Capital increased its price target on SiteOne Landscape Supply Inc. (NYSE:SITE) from $151 to $171. The firm maintained an Outperform rating on the stock, which currently yields an adjusted upside potential of almost 28%.
The price target revision came on the back of the company’s fourth-quarter announcement. According to the firm, favorable signals around pricing, SG&A, and outgrowth have raised confidence in the stock’s elevated upside potential for the coming year.
On February 12, Truist increased the firm’s price target on SiteOne Landscape Supply Inc. (NYSE:SITE) to $200 from $165. The firm maintains its Buy rating on the stock, which offers a revised upside of more than 49%. Following quarterly results that outperformed consensus expectations, shares appreciated 7%.
While the company’s 2026 guidance aligns with current market projections, Truist anticipates further share price recovery. The broader investment thesis now pivots toward the company’s ability to drive long-term margin growth against the backdrop of a gradual industry-wide recovery.
SiteOne Landscape Supply Inc. (NYSE:SITE) is a wholesale distributor of landscaping products, providing everything from irrigation systems and hardscapes to nursery stock and outdoor lighting. Beyond supplying essential materials like LESCO fertilizers and Solstice stone, the company offers value-added consultative services, including project planning, technical training, and business management support for professional contractors.
5. Xometry Inc. (NASDAQ:XMTR)
Xometry Inc. (NASDAQ:XMTR) is one of the 10 best trading and distribution stocks to buy.
On March 3, Xometry Inc. (NASDAQ:XMTR) reported the launch of its new Enterprise Machining Lead Time Prediction Model along with enhanced dynamic pricing logic, expanding the capabilities of its Instant Quoting Engine and further strengthening the company’s AI-driven manufacturing marketplace. The update is designed to improve manufacturing speed, pricing accuracy, and sourcing efficiency across Xometry’s partner network. Commenting on the release and its broader implications for the company’s technology platform, Chief Product & Technology Officer Vaidy Raghavan stated:
“This release represents more than just an incremental update; it is a foundation for future innovations and a fundamental shift in how we approach manufacturing speed and reliability at scale. By closing the data loop with our Partner Network and accelerating model deployment cycles through continuous training, we have reduced the time from insight to production impact. This allows us to solve complex, context-dependent sourcing challenges that static software or isolated AI agents cannot address.”
On February 25, Wedbush decreased the firm’s price target on Xometry Inc. (NASDAQ:XMTR) to $60 from $70. The firm maintained its Outperform rating on the stock, which currently yields an upside of almost 37%. The company reported fourth-quarter revenue and adjusted EBITDA that surpassed expectations, yet the stock declined by more than 20%.
Xometry Inc. (NASDAQ:XMTR) is an AI-driven marketplace that connects buyers with a vast network of manufacturing services, including CNC machining, 3D printing, and injection molding. By leveraging its instant quoting engine and industrial platforms like Thomasnet, the company provides cloud-based collaboration tools and execution systems that streamline custom-part sourcing and production workflows.
4. McGrath RentCorp (NASDAQ:MGRC)
McGrath RentCorp (NASDAQ:MGRC) is one of the 10 best trading and distribution stocks to buy.
On February 26, McGrath RentCorp (NASDAQ:MGRC) reported fourth-quarter revenue of $256.8 million compared to the consensus forecasts of $254.3 million. The company, under the leadership of its President and CEO, Joe Hanna, was pleased with the fourth-quarter results, which showed a 5% increase in revenue and a 14% jump in adjusted EBITDA. This was primarily driven by its Mobile Modular and TRS-RenTelco businesses.
Modular rental revenue grew 2% from commercial customers, while Portable Storage revenue grew 3%. TRS-RenTelco reported a 13% increase in rental revenue, driven by strong equipment sales, despite challenging conditions in the non-residential construction sector. However, Hanna was encouraged by the early 2026 results and was optimistic about building on the company’s progress in 2025.
On February 11, Barclays initiated coverage of McGrath RentCorp (NASDAQ:MGRC) with an Overweight rating. The firm also set a price target of $140, leading to an upside of almost 33% for investors. Barclays views McGrath as a relatively safer way to gain exposure to a potential recovery in U.S. non-residential construction compared with other early-cycle turnaround names.
McGrath RentCorp (NASDAQ:MGRC) is a business-to-business rental company operating across four distinct segments: Mobile Modular, Portable Storage, TRS-RenTelco, and Enviroplex. The company provides a versatile range of relocatable buildings, portable storage containers, and specialized electronic test equipment, serving critical sectors including education, construction, healthcare, aerospace, and defense.
3. Herc Holdings Inc. (NYSE:HRI)
Herc Holdings Inc. (NYSE:HRI) is one of the 10 best trading and distribution stocks to buy.
On March 9, Citi reduced its price target on Herc Holdings Inc. (NYSE:HRI) from $185 to $165. The firm reiterated a Buy rating on the stock, which still offers an adjusted upside potential of over 36% at the prevailing level.
The firm highlighted the ConExpo construction trade show, which reflected on favorable trends in demand, along with an impressive pipeline of mega projects. Citi is bullish on the machinery rental space and holds a highly favorable view of the U.S. construction space.
Back on February 18, Baird decreased the firm’s price target on Herc Holdings Inc. (NYSE:HRI) from $200 to $198. The firm maintained its Outperform rating on the stock, which still offers more than 63%. Following the company’s fourth-quarter results, the firm made adjustments to its model.
The firm believes that although currently the business remains characterized by choppiness, the updated outlook signals that the company is approaching an inflection point, with performance expected to trend more favorably in the upcoming periods.
Herc Holdings Inc. (NYSE:HRI) operates primarily within the equipment rental segment. The company provides a comprehensive portfolio of aerial, earthmoving, material-handling, and specialized equipment. They further support these offerings with value-added services, including fleet management, safety training, maintenance, and industry-specific solutions, delivered through their ProSolutions and ProContractor platforms.
2. DNOW Inc. (NYSE:DNOW)
DNOW Inc. (NYSE:DNOW) is one of the 10 best trading and distribution stocks to buy.
On February 20, DNOW Inc. (NYSE:DNOW) reported revenue of $959 million for the fourth quarter, compared to $571 million during the same period last year. The company reported strong 2025 results, with revenue of $2.8 billion and an adjusted EBITDA margin of 7.4%. DNOW reported its fifth consecutive year of revenue growth excluding MRC Global results, with a new record for adjusted EBITDA.
The MRC Global deal provides growth opportunities for DNOW and sets it up for long-term success. The company faces near-term headwinds from the US MRC Global ERP transition. President and CEO, David Cherechinsky, stated:
“The merger with MRC Global expands DNOW’s growth opportunities and strategically positions the company for long-term success. I am encouraged by the strong start to our integration efforts and the early progress of our synergy realization initiatives, which we expect will create meaningful value for our combined business over time.”
Management also revealed a delay in its full-year guidance due to persistent hurdles related to the company’s ERP implementation in its legacy MRC Global U.S. operations.
DNOW Inc. (NYSE:DNOW) operates within the distribution segment, providing an extensive range of pipes, valves, fittings, pumps, and specialized MRO supplies. The company supports complex industrial operations from energy and utilities to manufacturing and data centers by offering integrated supply chain management, modular facility solutions, and rigorous technical, maintenance, and engineering services.
1. QXO Inc. (NYSE:QXO)
QXO Inc. (NYSE:QXO) is one of the 10 best trading and distribution stocks to buy.
On February 26, QXO Inc. (NYSE:QXO) reported fourth-quarter revenue of $2.19 billion, which was in line with the consensus estimates and the pre-announcement. Operationally, the company is executing its integration plan for the combined legacy Beacon business with disciplined investments in technology, sales capacity, and high-return initiatives. Chairman and CEO Brad Jacobs stated:
“Our fourth quarter results were in line with the pre-announcement we made last month. Operationally, we are executing against our integration plan across the legacy Beacon business, supported by disciplined investments in technology, sales capacity, and other high-return, long-term initiatives. On the M&A front, our recently announced $2.25B agreement to acquire Kodiak Building Partners triples our total addressable market to more than $200B. With Kodiak, we have grown our EBITDA run rate to more than $1B in under 10 months. Our acquisition pipeline remains very active, keeping us firmly on track to achieve $50B in annual revenue.”
On February 11, QXO Inc. (NYSE:QXO) reported that it has reached a definitive agreement to acquire Kodiak Building Partners from Court Square Capital Partners in a deal valued at about $2.25 billion. The company expects the transaction to be highly accretive to 2026 earnings and said it would expand QXO’s addressable market to more than $200 billion.
The purchase price includes $2 billion in cash along with 13.2 million shares, for which QXO retains the option to repurchase at $40 per share. The deal is expected to close in early Q2 2026, subject to customary closing conditions.
The company is currently pursuing an aggressive inorganic growth strategy, aiming to expand the topline to $50 billion within the next decade.
QXO Inc. (NYSE:QXO) is a tech-enabled distributor of building products such as roofing, waterproofing, materials, and related supplies. It markets its offerings through contractors, distributors, and suppliers.
While we acknowledge the potential of QXO as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than QXO and that has 100x upside potential, check out our report about the cheapest AI stock.
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