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The Zacks Analyst Blog Highlights The LGL Group, A. O. Smith, DXP Enterprises and Nordson
Zacks Equity Research
7 min read

In This Article:

For Immediate Release

Chicago, IL – July 8, 2022 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: The LGL Group, Inc. LGL, A. O. Smith Corp. AOS, DXP Enterprises, Inc. DXPE and Nordson Corp. NDSN.

Here are highlights from Thursday’s Analyst Blog:

4 Stocks Set to Gain on Solid Jump in Factory Orders

Manufacturing activity is growing at a fast pace in the United States, even though economic data is hinting at a slowing economy. Rising costs of raw materials and a supply-chain crisis have not yet curtailed manufacturing activity. In fact, it increased at a faster pace than expected in May, as recent data shows a solid jump in factory orders.

Also, new orders for U.S. manufactured goods have been rising steadily despite the Fed's aggressive rate-hike policy that has seen people spending cautiously. Given this situation, stocks like The LGL Group, Inc., A. O. Smith Corp., DXP Enterprises, Inc. and Nordson Corp. are likely to benefit in the near term.

Factory Orders Rise in May

The Commerce Department said on Jul 6 that factory orders for May jumped a solid 1.6% or $8.4 billion to $543 billion, beating analysts' expectations of a rise of 0.5%. May's jump follows a 0.7% rise in factory orders in April.

Manufacturing accounts for 12% of the U.S. economy and May's jump once again proves the continued demand for durable goods. Factory orders have now increased in 21 out of the past 22 months, indicating that demand for U.S.-made factory goods is still high despite the slowdown indicated by economic data.

The jump in orders was across a range of categories, with notable increases in metals, machinery, transportation equipment, computers and electronic products. Orders for computers and electronic goods increased 0.5% in May.

The Commerce Department also reported a 1.8% increase in shipments of manufactured goods in May.

Orders for non-defense capital goods, excluding airplanes, viewed as a gauge of business spending plans on equipment, grew 0.6% in May rather than the 0.5% that was previously reported, according to the Commerce Department.

Manufacturing Sector on Solid Ground

Manufacturing activity is still going strong despite challenges like rising raw material costs and supply-chain crisis. Higher demand is driving orders for factory goods, and rising costs, despite being a major determinant, haven't made much of a difference.

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