In this article, we will discuss the 12 Best Industrial Stocks to Buy According to Wall Street Analysts.
The outlook for sectors tied to economic growth has improved significantly amid the US economy’s resilience in the face of tariffs and trade wars. With the prospect of the US economy plunging into recession receding, industrial stocks have edged higher, in line with the broader market rallying to record highs.
While focus has long been on tech megacaps, investors are increasingly turning to sectors trading at highly discounted valuations. That’s evident as the industrial sector is up by about 17% for the year, outperforming the average 16% for the S&P 500 year to date. The shift towards industrial stocks comes amid expectations that waning trade frictions will support the US economy.
“It does show that the market is more than just artificial intelligence,” said Brian Jacobsen, the chief economist at Annex Wealth Management, of the Dow’s advance to a record. “Industrials, transportation, and consumers can all benefit from the clarity on tax policy, the increasing clarity on tariff policy, and the evolving and nascent clarity on monetary policy.”
Sentiment around industrial stocks has improved amid heightened global risk appetite, elevated US rate-cut expectations, and solid financial results. U.S. President Donald Trump’s slashing of fuel-economy standards is another catalyst that has bolstered the sector’s outlook.
“There’s finally a bit of good news for a sector that has struggled to make sustained headway in terms of real upside for quite some time… the loosening of regulation might just allow the sector a bit of breathing room,” IG Chief Market Analyst Chris Beauchamp said.
As the tide turns in favor of industrials amid a resilient US economy, with the back of easing monetary policy, let’s look at some of the best stocks to buy according to Wall Street analysts.
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Our Methodology
To identify the best industrial stocks favored by Wall Street analysts, we examined leading ETFs and leveraged the Finviz screener to narrow down on companies operating within the industrial sector. Our selection emphasized stocks with an upside potential exceeding 30%, while also noting the number of hedge funds holding positions in each as of the third quarter of 2025. Finally we ranked the stocks in ascending order based on their upside potential as of December 8.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research shows 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 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
Best Industrial Stocks to Buy According to Wall Street Analysts
12. Loar Holdings Inc. (NYSE:LOAR)
Stock Upside Potential: 30.42%
Number of Hedge Fund Holders: 29
Loar Holdings Inc. (NYSE:LOAR) is one of the best industrial stocks to buy according to Wall Street analysts. Loar Holdings Inc. (NYSE:LOAR) has a Strong Buy rating from 4 Wall Street analysts. The average price target on the stock is $86.56, implying 30.42% upside potential from current levels of $66.37 a share.
On December 1, the company amended its Credit Agreement to increase the loan commitment by $175 million to $275 million. It also extended the term loan’s availability period through September 30, 2026. The adjustments follow record third-quarter sales of $127 million, driven by strong demand in the aerospace and defense sectors. It also achieved a net income of $19 million.
Meanwhile, analysts at Goldman Sachs initiated coverage of the stock on November 25 with a Buy rating and a $91 price target. Analyst Noah Poponak called Loar a high-quality aerospace aftermarket M&A compounder that is still early in its development but already stands out for having one of the strongest financial profiles in the group he follows. Goldman pointed to the company’s steady fundamentals and its growing presence in the aerospace components market as it continues to build its position in the industry.
Loar Holdings Inc. (NYSE:LOAR) is a diversified aerospace and defense company that designs and manufactures niche, critical components for commercial, business, and general aviation, focusing on creating a global alliance of specialized companies.
11. Resideo Technologies, Inc. (NYSE:REZI)
Stock Upside Potential: 30.45%
Number of Hedge Fund Holders: 46
Resideo Technologies Inc. (NYSE:REZI) is one of the best industrial stocks to buy according to Wall Street analysts. Resideo Technologies Inc. (NYSE:REZI) holds a consensus Moderate Buy rating with a $44 average target, implying 30.45% upside potential.
On December 3, Resideo Technologies Inc. unveiled a new X8S thermostat designed to enhance live video streaming from compatible doorbell cameras. Priced at $219.99, it comes with a 5-inch touchscreen that lets users view video feeds from Ring doorbells. It also includes monitoring capabilities for indoor air quality factors such as humidity and estimated carbon dioxide levels. The Honeywell Home X8S Smart Thermostat is designed for customers seeking a sleek, modern design and an energy-efficient solution. It’s Matter-certified and compatible with Amazon Alexa and Apple Home for easy voice control.
Earlier on November 12, Resideo Technologies shared its strategy at the Baird Global Industrial Conference, where CFO Mike Carlet said the company plans to separate the Products and Solutions unit from the ADI distribution business to give investors a clearer view of each operation. The firm is dealing with short term pressure from the new ERP system at ADI, which cut EBITDA by about 15 million dollars in the third quarter and is expected to do the same in the fourth, along with a drop in HVAC related air product sales. Even so, Resideo posted $7.5 billion in revenue and a 10.5% adjusted EBITDA margin over the past year.
Leadership remains upbeat, pointing to growth in non HVAC products, the launch of the Elite Pro thermostat aimed at rivals like Nest and Ecobee, and ADI’s margin goals following the Snap One deal. The company expects mid single digit revenue growth and better margins over the next several years, supported by the business separation, supply chain improvements, new products, and a solid balance sheet.
Resideo Technologies, Inc. (NYSE:REZI) makes smart home technology for comfort, energy management, and safety, including thermostats (Honeywell Home), smoke detectors, security systems, and water management, and also operates ADI Global Distribution, a major wholesale distributor of security, fire, and low-voltage products to professionals worldwide.
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