Jim Cramer's 4 Best Stock Picks in the Industrials Sector

NEW YORK (TheStreet) - As the market wraps up a record year, investors should consider owning industrial stocks for their portfolios.

The industrial sector is one of 12 sectors where investors should put their money, according to TheStreet's Jim Cramer. In each of Cramer's 12 sectors, "you can almost throw darts and win with a couple of rare exceptions," Cramer wrote in Here Are 12 Sectors to Bet On on the Real Money Web site.

The S&P 500 Industrial Sector Index is up 8.6% this year compared to the broader S&P 500 index this year, which is up 12%.

We've listed Cramer's picks alongside the TheStreet Ratings, TheStreet's proprietary stock rating tool which projects a stock's total return potential over a 12-month period including both price appreciation and dividends. Based on 30 major data points, TheStreet Ratings uses a quantitative approach to rating stocks. The model is both objective, using elements such as volatility of past operating revenues, financial strength, and company cash flows, and subjective, including expected equities market returns, future interest rates, implied industry outlook and forecasted company earnings.

Cramer's analysis and that of TheStreet Ratings may differ as Cramer may evaluate stocks without regard to time horizon, while TheStreet Ratings uses consensus estimates for the next 12 months only. In addition, changes in TheStreet Ratings may lag Jim Cramer's analysis, as consensus estimates may take some time to change meaningfully.

Check out Cramer's top picks in the industrials sector.

Parker Hannifin

Parker Hannifin (PH) is a leading diversified manufacturer of motion and control technologies and systems, providing precision-engineered solutions for a wide variety of mobile, industrial and aerospace markets.

Parker Hannifin had fiscal 2014 (ended June 30) sales of $13.2 billion.

Market Cap: $19 billion

52-week high: $133.41 on Nov. 25, 2014

52-week low: $99.82 on Oct. 15

Year-to-date Return: 1.3%

TheStreet Ratings team rates PARKER-HANNIFIN CORP as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation:

"We rate PARKER-HANNIFIN CORP (PH) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its increase in stock price during the past year, growth in earnings per share, increase in net income, revenue growth and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company shows weak operating cash flow."

You can view the full analysis from the report here: PH Ratings Report

International Paper

International Paper (IP) is a global leader in the packaging and paper industry and supplies a wide range of products that people rely on every day. The company produces uncoated papers and industrial and consumer packaging. The company also offers printing, packaging, graphic arts, and maintenance and industrial products.

International Paper had fiscal 2013 sales of $29 billion.

Market Cap: $23 billion

52-week high: $55.15 on Dec. 4, 2014

52-week low: $43.61 on April 15

Year-to-date Return: 14%

TheStreet Ratings team rates INTL PAPER CO as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:

"We rate INTL PAPER CO (IP) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and solid stock price performance. We feel these strengths outweigh the fact that the company has had sub par growth in net income."

You can view the full analysis from the report here: IP Ratings Report

Boeing

Boeing (BA) is the world's largest aerospace company and leading manufacturer of commercial jetliners and defense, space and security systems.

Boeing had fiscal 2013 revenue of $87 billion.

Market Cap: $94 billion

52-week high: $144.57 on Jan. 22, 2014

52-week low: $116.32 on Oct. 15

Year-to-date Return: -3%

TheStreet Ratings team rates BOEING CO as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:

"We rate BOEING CO (BA) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, impressive record of earnings per share growth, compelling growth in net income and notable return on equity. We feel these strengths outweigh the fact that the company shows low profit margins."

You can view the full analysis from the report here: BA Ratings Report

Honeywell International

Honeywell international (HON) is a diversified technology and manufacturing company, serving customers worldwide with aerospace products and services, control, sensing and security technologies for buildings, homes and industry, turbochargers, automotive products, specialty chemicals, electronic and advanced materials, process technology for refining and petrochemicals, and energy efficient products and solutions for homes, business and transportation.

Honeywell had fiscal 2013 revenue of $39 billion.

Market Cap: $78 billion

52-week high: $100.16 on Dec. 5, 2014

52-week low: $82.89 on Oct. 15

Year-to-date Return: 9.3%

TheStreet Ratings team rates HONEYWELL INTERNATIONAL INC as a Buy with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation:

"We rate HONEYWELL INTERNATIONAL INC (HON) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, increase in stock price during the past year, impressive record of earnings per share growth and compelling growth in net income. We feel these strengths outweigh the fact that the company shows low profit margins."

You can view the full analysis from the report here: HON Ratings Report

--Written by Laurie Kulikowski in New York.

Follow @LKulikowski

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