The industrial sector could finally rebound next year, according to a top analyst on Wall Street. Goldman Sachs Managing Director Joe Ritchie sits down with Morning Brief host Seana Smith and explains that the macroeconomic backdrop could lead to a manufacturing comeback after months of contraction.

“Cautious optimism is where we’re at today,” Ritchie says at the Goldman Sachs Industrial and Materials conference this week. “Several companies are expecting better growth in 2025… It’s only a matter of time before it happens. It'll inflect at some point in 2025.”

Ritchie lays out some of his top stock picks for 2025, including Parker-Hannifin (PH) and GE Vernova (GEV).

On Parker-Hannifin, Ritchie says “it’s a great company and very well run… About two-thirds of the business is tied to industrial activity, and about one-third of the business is tied to aerospace and defense. They've been able to perform incredibly well even at a time when the industrial markets haven't been a tailwind for them.”

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This post was written by Rachel Sherman.