With the first half of 2023 coming to a close, investors may be interested in the stocks that have had strong performances so far this year.
The industrials sector has posted the largest year-to-date return at 14.37%.
Some stocks within this space are outperforming the S&P 500, which has posted a gain of around 16%. As of June 30, the GuruFocus All-in-One Screener, a Premium feature, found several stocks with a market cap greater than $5 billion that had a higher return relative to the index for the period. It also looked at stocks with price-earnings ratios below 15 and predictability ranks of at least one out of five stars.
Based on these criteria, industrial stocks that have outperformed the benchmark index by at least 15% year to date include Builders FirstSource Inc. (BLDR, Financial), Owens-Corning Inc. (OC, Financial), United Airlines Holdings Inc. (UAL, Financial) and WESCO International Inc. (WCC, Financial).
Builders FirstSource
Topping the index by approximately 94.46% since the start of the year, Builders FirstSource (BLDR, Financial) has a $17.51 billion market cap; its shares were trading around $136.77 on Fridaywith a price-earnings ratio of 8.70, a price-book ratio of 3.87 and a price-sales ratio of 0.99.
The Dallas-based company manufactures and supplies building materials, including lumber, doors, decking, windows, manufactured components, insulation and tools.
The GF Value Line suggests the stock is significantly overvalued currently based on its historical ratios, past financial performance and analysts’ future earnings projections.
At 77 out of 100, the GF Score indicates the company is likely to have average performance going forward. While it received high ratings for profitability and growth, the financial strength is more moderate and the momentum and value ranks are low.
Builders FirstSource also has a three-star predictability rank. According to GuruFocus research, companies with this rank return an average of 8.32% annually over a 10-year period.
Of the gurus invested in Builders FirstSource, Jim Simon’s Renaissance Technologies has the largest holding with 0.76% of its outstanding shares. Chuck Royce (Trades, Portfolio), Ken Fisher (Trades, Portfolio), Steven Cohen (Trades, Portfolio) and Ray Dalio (Trades, Portfolio)’s Bridgewater Associates also have notable positions in the stock.
Owens-Corning
Beating the benchmark by around 39.52% so far this year, Owens-Corning (OC, Financial) has a market cap of $11.84 billion; its shares were trading around $131.05 on Friday with a price-earnings ratio of 9.51, a price-book ratio of 2.49 and a price-sales ratio of 1.28.
The company, which is headquartered in Toledo, Ohio, produces and sells insulation, roofing and fiberglass composites, along with related materials.
According to the GF Value Line, the stock is modestly overvalued currently.
The GF Score of 87 implies the company has good outperformance potential, driven by high ratings for profitability and growth, middling marks for financial strength and momentum and a low value rank.
Owens-Corning also has a three-star predictability rank.
With a 4% stake, Chris Davis (Trades, Portfolio) is the company’s largest guru shareholder. Other gurus invested in Owens-Corning are Jeremy Grantham (Trades, Portfolio), Fisher, Dalio’s firm, Joel Greenblatt (Trades, Portfolio), Paul Tudor Jones (Trades, Portfolio) and Jefferies Group (Trades, Portfolio).
United Airlines
Eclipsing the benchmark index by around 27.02% over the past six months, United Airlines (UAL, Financial) has a $17.94 billion market cap; its shares were trading around $54.82 on Friday with a price-earnings ratio of 9.42, a price-book ratio of 2.70 and a price-sales ratio of 0.38.
The Chicago-based airline offers flights both in the U.S. and internationally, though it is known for its focus on long-haul travel.
Based on the GF Value Line, the stock appears to be modestly undervalued currently.
With a GF Score of 70, however, the company is likely to have average performance going forward. Receiving high ranks for value and momentum, the profitability and financial strength ratings are more moderate and growth is low.
The company also has a one-star predictability rank. GuruFocus found companies with this rank return an average of 1.1% annually.
PRIMECAP Management (Trades, Portfolio) is United’s largest guru shareholder with a 7.29% stake. The stock is also being held by Jim Simons (Trades, Portfolio)’ Renaissace Technologies, Cohen, Jefferies Group (Trades, Portfolio), Caxton Associates (Trades, Portfolio), Lee Ainslie (Trades, Portfolio) and Greenblatt.
WESCO International
Surpassing the S&P 500 by roughly 25.72%, WESCO International (WCC, Financial) has a $9.18 billion market cap; its shares were trading around $179.06 on Friday with a price-earnings ratio of 11.46, a price-book ratio of 2 and a price-sales ratio of 0.44.
The company, which is headquartered in Pittsburgh, is a distributor of industrial products for electric and electronic solutions, communication and security solutions and utility and broadband solutions.
The GF Value Line suggests the stock is modestly overvalued currently.
Further, the GF Score of 88 means the company has good outperformance potential on the back of high ratings for profitability, growth and momentum, a more moderate financial strength rank and a low grade for value.
WESCO International has a one-star predictability rank.
Holding a 3.27% stake, WESCO’s largest guru shareholder is Diamond Hill Capital (Trades, Portfolio). Daniel Loeb (Trades, Portfolio), Simons’ firm, Cohen, Robert Olstein (Trades, Portfolio) and several other gurus also own the stock.
Additional outperformers
Other industrial stocks that beat the benchmark in the first half of the year were Avis Budget Group Inc. (CAR, Financial), American Airlines Group Inc. (AAL, Financial) and Crane Co. (CR, Financial).
