Laser Focus World is an industry bedrock—first published in 1965 and still going strong. We publish original articles about cutting-edge advances in lasers, optics, photonics, sensors, and quantum technologies, as well as test and measurement, and the shift currently underway to usher in the photonic integrated circuits, optical interconnects, and copackaged electronics and photonics to deliver the speed and efficiency essential for data centers of the future.

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Editorial Advisory Board

  • Professor Andrea M. Armani, University of Southern California
  • Ruti Ben-Shlomi, Ph.D., LightSolver
  • James Butler, Ph.D., Hamamatsu
  • Natalie Fardian-Melamed, Ph.D., Columbia University
  • Justin Sigley, Ph.D., AmeriCOM
  • Professor Birgit Stiller, Max Planck Institute for the Science of Light, and Leibniz University of Hannover
  • Professor Stephen Sweeney, University of Glasgow
  • Mohan Wang, Ph.D., University of Oxford
  • Professor Xuchen Wang, Harbin Engineering University
  • Professor Stefan Witte, Delft University of Technology

3 Industrials Stocks in Hot Water

PESI Cover Image

Industrials businesses quietly power the physical things we depend on, from cars and homes to e-commerce infrastructure. But they are at the whim of volatile macroeconomic factors that influence capital spending (like interest rates), and the market seems convinced that demand will slow. Due to this bearish outlook, the industry has tumbled by 5.7% over the past six months. This drawdown was disheartening since the S&P 500 stood firm.

Investors should tread carefully as timing cyclical companies is a challenging task, and any misstep can have you catching a falling knife. Taking that into account, here are three industrials stocks that may face trouble.

Perma-Fix (PESI)

Market Cap: $182.8 million

Tackling hazardous waste challenges since 1990, Perma-Fix (NASDAQ: PESI) provides environmental waste treatment services.

Why Do We Steer Clear of PESI?

  1. Sales tumbled by 7.3% annually over the last five years, showing market trends are working against its favor during this cycle
  2. Eroding returns on capital from an already low base indicate that management’s recent investments are destroying value
  3. Depletion of cash reserves could lead to a fundraising event that triggers shareholder dilution

Perma-Fix is trading at $10.15 per share, or 94.8x forward EV-to-EBITDA. Check out our free in-depth research report to learn more about why PESI doesn’t pass our bar.

FedEx (FDX)

Market Cap: $54.99 billion

Sporting one of the largest air cargo fleets in the world, FedEx (NYSE: FDX) is a global provider of parcel and cargo delivery services.

Why Is FDX Risky?

  1. Products and services are facing significant end-market challenges during this cycle as sales have declined by 2.6% annually over the last two years
  2. Estimated sales for the next 12 months are flat and imply a softer demand environment
  3. Earnings per share lagged its peers over the last two years as they only grew by 2% annually

At $222.45 per share, FedEx trades at 10.4x forward P/E. If you’re considering FDX for your portfolio, see our FREE research report to learn more.

Stanley Black & Decker (SWK)

Market Cap: $11.06 billion

With an iconic “STANLEY” logo which has remained virtually unchanged for over a century, Stanley Black & Decker (NYSE: SWK) is a manufacturer primarily catering to the tool and outdoor equipment industry.

Why Should You Dump SWK?

  1. Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy
  2. Performance over the past five years shows its incremental sales were much less profitable, as its earnings per share fell by 11% annually
  3. Free cash flow margin shrank by 8.7 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive

Stanley Black & Decker’s stock price of $70.62 implies a valuation ratio of 13.2x forward P/E. To fully understand why you should be careful with SWK, check out our full research report (it’s free).

High-Quality Stocks for All Market Conditions

The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.

While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years.

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today for free.

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