Here's Why Industrial Stocks Are Set for a Tough Earnings Season
Expect more volatility to come in the current earnings seasons. At least, that's how it looks in the industrial sector if the earnings report from industrial supply company MSC Industrial Direct (NYSE: MSM) is anything to go by. Here's the lowdown and how you might prepare to invest in the coming earnings season.
Industrial supply companies serve as reliable indicators for the industrial economy. Their sales cycles are notably short, which means they are quick to experience the effects of market slowdowns and can rapidly expand sales when conditions improve. This sensitivity underscores the need for careful consideration in your investment decisions.
Naturally, not all industrial supply companies are equal. In MSC Industrial's case, sales are heavily focused on heavy manufacturing (almost half of its sales) and, to a lesser extent, light manufacturing (around 20%).
Source Fool.com
