We have recently shared a list titled 12 Best Industrial Dividend Stocks to Invest in Now. In this article, we will examine how FedEx Corporation (NYSE:FDX) compares with other top industrial dividend stocks worth investing in currently.
Industrial stocks are vital for economic growth, spanning numerous sectors, including manufacturing and transportation. This sector tends to thrive during economic booms and is poised to benefit from increased government spending on infrastructure. While it is diverse, companies within this sector share common traits and are in a favorable position to leverage several key trends. These factors highlight the significant role industrials play in a well-rounded investment portfolio.
In recent years, the industrial economy has generally seen improving demand, although some areas, particularly manufacturing automation, are beginning to show weakness. An analysis by Edward Jones pointed out that while recovery is on the horizon, various short-term uncertainties could affect the sector’s growth. These uncertainties include a possible slowdown in economic expansion, persistent geopolitical issues, and decreasing business and consumer confidence.
Moreover, the increasing risk of a global trade conflict between the United States and major trading partners adds another layer of uncertainty for the industrial sector. The administration has imposed tariffs on materials such as steel and aluminum, but the full ramifications of these measures are yet to be seen. Additional tariff actions are likely forthcoming, targeting nations like China and the European Union, and retaliation from these regions is expected through tariffs or other policy responses.
Throughout 2024, the industrial sector saw solid returns overall, but it slightly underperformed compared to the broad market in a favorable year for stocks. According to a report by Fidelity Investments, the industrial sector began the year robustly, generally aligning with market performance through April. A dip occurred in May and June, but the sector rebounded in July, emerging as one of the market’s better-performing segments. This fluctuating performance mirrored optimism regarding a potential soft landing for the U.S. economy alongside concerns over weak manufacturing indicators and soaring stock valuations.
The same Fidelity report identified several significant themes likely to yield investment opportunities in the coming year. One of these themes is the revival of U.S. manufacturing. A unique combination of factors is promoting a notable surge in domestic infrastructure reinvestment, efforts to bring supply chains back to the U.S. to reduce geopolitical risks, and increased funding for electrification and artificial intelligence advancements.
For this discussion, we analyzed Insider Monkey’s database of over 1,000 hedge funds as of the fourth quarter of 2024, selecting industrial firms across various sectors—including manufacturing, construction, and logistics. From this selection, we identified 12 dividend-paying companies and ranked them based on how many hedge funds held stakes in them at the end of Q4 2024. We focus on stocks that hedge funds favor because our research shows that mimicking leading hedge funds’ stock picks can yield superior market returns. Our quarterly newsletter has achieved a return of 373.4% since May 2014, surpassing its benchmark by 218 percentage points (see more details here).
