10 Industrial Stocks Poised to Break Out

As the broader market rally continues to bring individual stocks near their highs of earlier last summer, the list of potential breakout candidates grows. The energy and technology sectors both have been fertile ground in which to find stocks on the verge of breaking out to new high ground, and now the industrial sector is setting up as a source of opportunity — providing, of course, that the broader market can hold up.

One way to play this is simply to use the Select Sector Industrial SPDR (NYSE:XLI) ETF, which closed Wednesday 5.9% short of its 52-week high of $38.98. But for those who prefer the higher-beta potential of individual stocks, here are a number of names to consider:

FedEx

Click to EnlargeNYSE:FDX

Wednesday�s close: $94.15

Breakout level: $98.66

Percent move needed for breakout: 4.8%

 

This is the fourth time in two years that FDX has entered the $95-$100 range. While a break above $98.66 still would leave the stock well short of its all-time high above $120, set in 2007, note that United Parcel Service (NYSE:UPS) already has moved out to a new high off of a similar formation as FDX. This bodes well for FedEx if the broader market holds up.

Canadian National Railway

Click to EnlargeNYSE:CNI

Wednesday�s close: $77.53

Breakout level: $81.26

Percent move needed for breakout: 4.8%

 

Similar to FedEx, a number of CNI�s industry peers have broken out to new highs in recent months, among them Union Pacific (NYSE:UNP), Canadian Pacific Railway (NYSE:CP) and Kansas City Southern (NYSE:KSU).

Caterpillar

Click to EnlargeNYSE:CAT

Wednesday�s close: $112.53

Breakout level: $116.55

Percent move needed for breakout: 3.6%

 

�BorgWarner

Click to EnlargeNYSE:BWA

Wednesday�s close: $80.58

Breakout level: $82.28

Percent move needed for breakout: 2.1%

 

�Fiserv

Click to EnlargeNASDAQ:FISV

Wednesday�s close: $64.65

Breakout level: $66.06

Percent move needed for breakout: 2.2%

 

Praxair

Click to EnlargeNYSE:PX

Wednesday�s close: $107.66

Breakout level: $111.74

Percent move needed for breakout: 3.8%

 

Heico

Click to EnlargeNYSE:HEI

Wednesday�s close: $58.43

Breakout level: $61.97

Percent move needed for breakout: 6.1%

 

Eagle Materials

Click to EnlargeNYSE:EXP

Wednesday�s close: $33.27

Breakout level: $33.66

Percent move needed for breakout: 1.2%

 

Acuity Brands

Click to EnlargeNYSE:AYI

Wednesday�s close: $59.23

Breakout level: $61.45

Percent move needed for breakout: 3.7%

 

Crane

Click to EnlargeNYSE:CR

Wednesday�s close: $49.06

Breakout level: $52.38

Percent move needed for breakout: 6.8%

 

While these 10 charts look to be the most compelling, four others also have the potential for a breakout to new highs: Honeywell International (NYSE:HON), which is 5.6% away from breaking out; Ball Corp. (NYSE:BLL), 2.3%; Wabtec (NYSE:WAB), 8.2%; and Carlisle Cos. (NYSE:CSL), 8.1%.

As of this writing, Daniel Putnam did not hold a position in any of the aforementioned securities.