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One of the best ways of picking stocks is following what smart money and insiders are doing. We especially like imitating insiders' transactions because they have inside information and sometimes they use this to their advantage. Even when they don't have market moving inside information, they are better equipped than most analysts to judge the potential of their companies. Academic studies on insider trading have shown that insider purchases manage to beat the market even after adjusting for risks and other investment styles.

Below we compiled a list of industrial goods stocks insiders are bullish about. All companies have at least $10 billion market cap and were purchased by at least one insider during the past three months. The market data is sourced from Finviz.

Ticker

Company

YTD Return

No. of Insiders

EMR

Emerson Electric Co.

-7.01%

1

ETN

Eaton Corporation

-6.83%

1

ITW

Illinois Tool Works Inc.

-6.37%

1

NOC

Northrop Grumman Corporation

2.04%

2

RSG

Republic Services, Inc.

-4.45%

1

BA

Boeing Co.

4.63%

2

DOV

Dover Corp.

-2.26%

2

FAST

Fastenal Company

38.24%

2

HON

Honeywell International Inc.

4.75%

2

IR

Ingersoll-Rand Plc

-30.95%

2

Emerson Electric Co. (NYSE:EMR): Emerson Electric is engaged in designing and supplying product technology and delivering engineering services and solutions. EMR was purchased by one insider over the past three months and lost 7.01% since the beginning of this year. Arthur Golden, director at Emerson Electric, bought 3,000 shares at $43.31 on August 11. Golden also bought 2,000 shares at $52.41 in June this year. The stock is now trading at $50.31. It has a market cap of $38.8B and a P/E ratio of 15.99. Ken Fisher had $278 million invested in EMR.

Eaton Corporation (NYSE:ETN): Eaton is a diversified power management company. ETN was purchased by one insider over the past three months and lost 6.83% since the beginning of this year. Christopher Connor bought 1,000 shares at $41.02 on August 12. The stock is now trading at $44.5. It has a market cap of $15.4B and a P/E ratio of 12.46. Bain Capital had $185 million invested in ETN stocks.

Illinois Tool Works Inc. (NYSE:ITW): Illinois Tool Works is a diversified manufacturer of advanced industrial technology. ITW was purchased by one insider over the past three months and lost 6.37% since the beginning of this year. Jane Warner, EVP at the company, purchased 2,000 shares at $43.5 on August 25. The stock is now trading at $47.24. It has a market cap of $23.7B and a P/E ratio of 12.37. Ric Dillon had $157 million invested in ITW.

Northrop Grumman Corporation (NYSE:NOC): Northrop Grumman is an integrated enterprise consisting of businesses that cover the entire security spectrum, from undersea to outer space and into cyberspace. NOC was purchased by two insiders over the past three months and returned 2.04% since the beginning of this year. Linda Mills bought 490 shares at $57.38 and another 885 shares at $58.24 on November 7. Earlier in August, Wesley Bush, director of the firm, bought 10,000 shares at $49.75. The stock is now trading at $57.48. It has a market cap of $15.3B and a P/E ratio of 8.85. Jean-Marie Eveillard had over $200 million invested NOC stocks.

Republic Services, Inc. (NYSE:RSG): Republic Services, Inc. is a provider of services in the domestic non-hazardous solid waste industry.RSG was purchased by one insider over the past three months and lost 4.45% since the beginning of this year. Cascade Investment LLC bought 1,229,733 shares at $28.0342 on August 22. Cascade bought another 751,517 shares at $27.4151 on August 19 and 1,768,750 shares at $27.2503 on August 18. The stock is now trading at $27.33. It has a market cap of $10.3B and a P/E ratio of 19.54. John Osterweis had $95 million invested in RSG stocks.

Boeing Co. (NYSE:BA): The Boeing Company is an aerospace company. BA was purchased by two insiders over the past three months and returned 4.63% since the beginning of this year. Lawrence Kellner bought 1,000 shares at $65.0714 on November 3. On August 11, Susan Schwab, another director at Boeing, bought 346 shares at $57.959. The stock is now trading at $65.17. It has a market cap of $49.5B and a P/E ratio of 13.2. Ken Fisher invested $382 million in BA shares.

Dover Corp. (NYSE:DOV): Dover owns and operates a global portfolio of manufacturing companies providing components and equipment, specialty systems and support services for a variety of applications in the industrial products, engineered systems, fluid management and electronic technologies markets. DOV was purchased by two insiders over the past three months and lost 2.26% since the beginning of this year. On October 26, Richard Lochridge and Stephen Todd bought 7,150 shares and 1,000 shares respectively at slightly below $56. The stock is now trading at $53.98. It has a market cap of $10.4B and a P/E ratio of 12.68. Ken Fisher had $500+ million invested in DOV. Ric Dillon also had $189 million of DOV shares.

Fastenal Company (NASDAQ:FAST): Fastenal sells industrial and construction supplies in a wholesale and retail fashion. FAST was purchased by two insiders over the past three months and returned 38.24% since the beginning of this year. James Jansen bought 1,000 shares at $30.73 on August 10. Jansen also bought 4,000 shares at $34.28 on July 21. Michael Ancius, director at Fastenal, bought 330 shares at $29.92 on August 8. Ancius bought another 200 shares at $32.5 on August 3. The stock is now trading at $39.76. It has a market cap of $12.0B and a P/E ratio of 35.61. Steven Cohen had $60+ million of FAST shares. Ray Dalio also had $27 million invested in the stock.

Honeywell International Inc. (NYSE:HON): Honeywell is a diversified technology and manufacturing company. HON was purchased by two insiders over the past three months and returned 4.75% since the beginning of this year. Chico Jaime Pardo, director at Honeywell, bought 5,000 shares at around $45.8 per share on August 26. Four days prior to that, Scott Davis, another director of the company, bought 5,000 shares at $43.62. The stock is now trading at $53.03. It has a market cap of $42.3B and a P/E ratio of 17.08. Ken Fisher had $329 million of HON shares.

Ingersoll-Rand Plc (NYSE:IR): Ingersoll Rand provides products, services and solutions to enhance the comfort of air in homes and buildings, transport and protect food and perishables, and secure homes and commercial properties. IR was purchased by two insiders over the past three months and lost 30.95% since the beginning of this year. Gary Forsee bought 2,500 shares at $28.25 on August 18. Forsee also purchased 990 shares at $50.71 in May. On August 12, another director John Bruton also bought 850 shares at $29.63. Bruton has also purchased another 500 shares at $49.45 in May. The stock is now trading at $30.82. It has a market cap of $10.1B and a P/E ratio of 30.72. Phill Gross and Robert Atchinson had the largest position in IR at the end of June, and they significantly increased their position by 1525% during the second quarter.

Source: 10 Industrial Goods Stocks That Insiders Are Buying