Illinois Tool Works and CarMax are two industrial stocks that could deliver surprising gains. Illinois Tool Works, a diversified manufacturer of products ranging from restaurant dishwashers to automotive parts, has raised its dividend for 63 consecutive years and repurchased nearly 10% of its outstanding shares over the past five years, driving market-beating total returns. Used car retailer CarMax has seen its stock rally more than 40% since the end of last year, including a 19% gain last month, as industry data suggests the cyclical headwinds of low inventory and high prices may be easing. Cox Automotive reports that used car inventories have edged up to 47 days' worth, while the average age of vehicles on U.S. roads stands at 12.8 years and the average new car price is $49,758, potentially forcing consumers back into the used market.
Illinois Tool Works IncArticle highlights dividend growth and share repurchases as drivers of total returns.
CarMax IncIndustry data suggests easing cyclical headwinds (low inventory, high prices) may boost used car demand.