10 Best Industrial Stocks to Invest in Now

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1. 3M Company (NYSE:MMM)

No. of Hedge Fund Holders: 82

3M Company (NYSE:MMM) provides diversified technology services. It offers industrial abrasives and finishing for metalworking applications and auto body repair solutions. After rallying by more than 90% last year, the stock is still edging higher, affirming firm investor conviction about its long-term prospects.

The company’s sentiments and prospects have improved significantly following a restructuring drive focused on the spin-off of the healthcare business, job cuts, changing 3M Company’s (NYSE:MMM) global go-to-market approach, and reducing management layers. Additionally, 3M has seen its growth metrics improve significantly owing to increased focus on research and development followed by improving operational performance and deployment of capital.

The efforts are already paying off, given that the operating margin has improved from 18.6% in 2023 to 21.4% as of last year. Earnings per share was up by 21%. In addition, management predicts a 2% to 3% growth in organic sales in 2025, with the operating margin improving to 23.3%, at the back of a 100% free-cash-flow conversion rate. Earnings growth is expected to be accelerated in the upcoming years by an enhanced R&D pipeline, a renewed emphasis on 3M Company’s (NYSE:MMM) industrial business, and numerous operational improvements.

While we acknowledge the potential of 3M Company (NYSE:MMM) to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than MMM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap.

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