The industrial machinery industry, which bore the brunt of COVID-19-pandemic-led mandatory closures, is regaining momentum on the back of favorable government policies and the resumption in economic activities. Furthermore, if the Biden Administration's $3.5 trillion reconciliation package, which is tied to the Senate-approved $1.2 trillion infrastructure bill, is passed, the industry should benefit significantly. Specifically, we think quality industrial machinery stocks Cummins Inc . (NYSE:CMI), Nordson (NASDAQ:NDSN), and Crane Co. (CR) are among companies that are well-positioned to capitalize on the industry tailwinds. Let’s discuss.The industrial machinery sector, which had been severely impacted by global lockdown measures and supply chain constraints, has been making a strong comeback over the past few months. A resumption in economic activities, rapid vaccination programs, and supportive government policies have aided the sector’s rebound. The global industrial machinery market is expected to reach $835.34 billion by 2026, registering a 3.6% CAGR.
Following the Senate's passage of a $1.2 trilling infrastructure bill last month, Democrats are pushing a $3.5 trillion budget reconciliation bill. House Speaker Nancy Pelosi has insisted that the infrastructure bill would not be voted on until the Senate passed the $3.5 trillion spending plan. If this bill is passed, the overall spending on infrastructure should propel the growth of the industrial machinery market.
So, we think it could be wise to bet on industrial machinery stocks Cummins Inc. (CMI), Nordson Corporation (NDSN), and Crane Co. (CR). These stocks are well-positioned to benefit from the approval of the infrastructure bill and deliver solid returns in the near term.