General Electric Company (GE), Siemens AG (ADR) (SI), ABB Ltd (ADR) (ABB): Three Companies Leading the Second Industrial Revolution

The second problem is that Siemens AG (ADR) (NYSE:SI) isn’t as efficient as GE. While the company is working to trim staff and streamline its businesses, its profit margin in 2012 lagged GE’s by about three percentage points.

Although the top and bottom lines have been less than spectacular of late, with both falling last year, long-term investors should like the potential offered by the company’s restructuring efforts.

Three little letters

ABB Ltd (ADR) (NYSE:ABB) is the smallest of this trio. However, its focus on helping customers use power more efficiently is likely to be a key benefit over the long term.

The company’s top line has been headed higher over the last few years, though the bottom line has been more variable. Streamlining efforts, meanwhile, have left profit margins at levels near GE’s and ABB Ltd (ADR) (NYSE:ABB) has been increasing its dividend since initiating it in 2006.

Another interesting aspect of the company’s business is that emerging markets make up about half of the company’s sales. Such markets make up about 35% of the business at General Electric Company (NYSE:GE) and 33% at Siemens AG (ADR) (NYSE:SI). As these high-growth regions move toward the middle class, ABB Ltd (ADR) (NYSE:ABB) looks best positioned to benefit.

ABB Ltd (ADR) (NYSE:ABB) has an around 3.3% dividend yield. Its share price has been range bound since the 2007 to 2009 recession. It may be the smallest of the trio, but has a solid business and good growth prospects fueled by emerging market exposure.

Bringing technology to the factory

All three of the industrial companies above are bridging the gap between technology and manufacturing. That’s going to be a good business for a long time, particularly as companies seek to maintain profit margins in an increasingly competitive world. All three are appropriate for growth and income investors, though General Electric Company (NYSE:GE) probably has the most upside potential because of its troubles during the recession.

The article 3 Companies Leading the Second Industrial Revolution originally appeared on Fool.com and is written by Reuben Brewer.

Reuben Brewer has no position in any stocks mentioned. The Motley Fool owns shares of General Electric Company. Reuben is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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