1 Industrials Stock with Exciting Potential and 2 We Brush Off

Jabin Bastian Mon, May 4, 2026 at 6:36 PM EDT 3 min read **

• ALTG
• ^GSPC
• DHI
• ALTG-PA
• FSLR

Even if they go mostly unnoticed, industrial businesses are the backbone of our country. They are also bound to benefit from a friendlier regulatory environment with the Trump administration, and this excitement has led to a six-month gain of 16.3% for the sector - higher than the S&P 500’s 6.4% return.

• More from Yahoo Scout Why should investors steer clear of D.R. Horton?

Why is First Solar considered a buy recommendation?

How might Trump administration policies benefit industrial stocks?

What makes Alta Equipment Group a stock to avoid?

Nevertheless, investors must be mindful as the cycle can unexpectedly turn. When this inevitably happens, only the elite companies will survive and ultimately thrive. On that note, here is one resilient industrials stock at the top of our wish list and two we’re steering clear of.

Two Industrials Stocks to Sell:

Alta (ALTG)

Market Cap: $259.6 million

Founded in 1984, Alta Equipment Group (NYSE:ALTG) is a provider of industrial and construction equipment and services across the Midwest and Northeast United States.

Why Do We Pass on ALTG?**

Sales tumbled by 1.1% annually over the last two years, showing market trends are working against its favor during this cycle

• Cash-burning history makes us doubt the long-term viability of its business model

• Short cash runway increases the probability of a capital raise that dilutes existing shareholders

Alta’s stock price of $7.90 implies a valuation ratio of 6.3x forward EV-to-EBITDA. If you’re considering ALTG for your portfolio, see our FREE research report to learn more.

D.R. Horton (DHI)

Market Cap: $42.53 billion

One of the largest homebuilding companies in the U.S., D.R. Horton (NYSE:DHI) builds a variety of new construction homes across multiple markets.

Why Do We Avoid DHI?

• Demand cratered as it couldn’t win new orders over the past two years, leading to an average 7.6% decline in its backlog

• Earnings per share have dipped by 14.8% annually over the past two years, which is concerning because stock prices follow EPS over the long term

• Diminishing returns on capital suggest its earlier profit pools are drying up

D.R. Horton is trading at $149.65 per share, or 13.9x forward P/E. Read our free research report to see why you should think twice about including DHI in your portfolio, it’s free.

One Industrials Stock to Buy:

First Solar (FSLR)

Market Cap: $22.75 billion

Headquartered in Arizona, First Solar (NASDAQ:FSLR) specializes in manufacturing solar panels and providing photovoltaic solar energy solutions.

Why Are We Backing FSLR?

• Market share has increased this cycle as its 23.3% annual revenue growth over the last two years was exceptional

• Free cash flow profile has moved into positive territory over the last five years, showing the company is at an important crossroads

• Returns on capital are growing as management capitalizes on its market opportunities

** Story Continues At $212.46 per share, First Solar trades at 10.5x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.

Stocks We Like Even More

ALSO WORTH WATCHING: Top 5 Momentum Stocks.** The best time to own a great stock is when the market is finally noticing it. These aren't just high-quality businesses. Something is happening with them right now. Elite fundamentals meeting near-term momentum - both boxes checked at the same time.

Find out which stocks our AI platform is flagging this week. See this week's Strong Momentum stocks - FREE. Get Our Strong Momentum Stocks for Free HERE.

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.

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