As the need to modernize farm infrastructure continues to rise, we think it could be wise to bet on fundamentally sound farm and heavy construction machinery stocks Caterpillar (CAT), CNH Industrial (NYSE:CNHI), Terex (NYSE:TEX), and REV Group (NYSE:REVG). We think these stocks have the potential to generate significant returns over the long term. So, let’s discuss them.The heavy construction machinery industry plays a vital role in constructing mechanical irrigation systems, heavy tractors, and other equipment for the farming industry. Since the onset of the COVID-19 pandemic, the farm and heavy construction machinery sector has suffered huge losses. But with heightened demand for farm mechanization, the industry is now expanding due to the integration of advanced technologies and growing food demand.
More than 80% of AEM members anticipate rising demand for construction and agriculture equipment over the next year. Furthermore, the U.S. infrastructure bill is expected to significantly boost the industry’s growth because it promises a better and more modernized farming industry. According to a Research and Markets report, the global agricultural machinery market is expected to grow at a 5.4% CAGR through 2026.
Thus, we think it could be wise to add quality farm and heavy construction machinery stocks Caterpillar Inc. (NYSE:CAT), CNH Industrial N.V. (CNHI), Terex Corporation (TEX), and REV Group, Inc. (REVG) to one’s portfolio now.