Rising investments in the industrial sector and surging demand for advanced and efficient machinery should drive the industrial machinery industry’s growth. Therefore, both Honeywell (HON) and ABB (ABB) should benefit. But which of these stocks is a better buy now? Read more to find out.Honeywell International Inc. (NASDAQ:HON) and ABB Ltd (ABB) are well-known companies in the global industrial machinery space. HON, which is headquartered in Morris Township, N.J., operates as a diversified technology and manufacturing company that provides aerospace products and services, control, sensing, and security technologies for commercial buildings, specialty chemicals, advanced materials, process technology for refining and petrochemicals, and energy-efficient products and solutions. In comparison, Switzerland-based ABB manufactures and sells electrification, industrial automation, and robotics and motion products for customers in utilities, industry and transport, and infrastructure.
Although the shortage and rising prices of iron ore compelled the machinery industry to cut back production early this year, the supply of used iron has incentivized companies to manufacture efficient power and hand tools, advanced and automated hardware, machinery, and related equipment to meet the surging demand from the resumption of industrial activities. Also, efforts to address the shortage of new iron supplies and the passage of the bipartisan infrastructure bill should drive the growth of machinery manufacturing companies in the coming months. The global industrial machinery market is expected to grow at a 3.6% CAGR to $835.34 billion by 2027. So, both HON and ABB should benefit.
While HON’s shares have declined by 1.5% in price over the past month, ABB has surged 3.5%. ABB is a clear winner with 8.5% gains versus HON’s negative returns in terms of their past six months’ performance. But which of these stocks is a better pick now? Let us find out.