BofA Sees Mostly Inline Q1 For Industrials, Highlights 3M, JCI, GE Vernova As Top Picks

B of A Securities analysts Andrew Obin and Sabrina Abrams shared their expectations for industrial stocks ahead of first-quarter earnings.

The analysts project the earnings to be a beat or at par, which is expected to be supported by strong second-quarter performances from industrial distributors like Fastenal Company (NASDAQ:FAST) and MSCI Inc. (NYSE:MSCI).

The analyst adds that a key risk is that investors won’t see any “bad” news, negative surprises, or downward estimate revisions until the second-quarter earnings season. He projects companies maintaining or lowering 2025 guidance.

Obin and Abrams anticipate capital expenditure and operating expense decisions to be made in the mid-to-late second quarter, positioning the third quarter as a potential earnings trough.

In particular, they foresee increased U.S. investment, particularly in areas with lower labor intensity and established supply chain infrastructure that can be scaled efficiently.

The analyst ...