Newscasts - Industrial stocks, not tech, may be next bubble, investor warns

Vulcan Materials Co

17/02/2026 21:15

Click the following link to watch video: https://share.newscasts.refinitiv.com/link?entryId=1_dqnysvnk&referenceId=tag:reuters.com,2026:newsml_RW629017022026RP1_930&pageId=Newscasts
Source: 'Reuters - Business videos'

Description: Eric Lynch, co-portfolio manager at Suncoast Equity Management, said that while industrial stocks are "up 15% or so year to date," earnings for many companies in that sector "aren't really growing."

Short Link: https://lseg.group/4rWfuWa

Video Transcript:

In terms of bubbles in the markets, interestingly, in the last several months, we've switched from what could potentially have been a tech bubble into a non-AI tech bubble. And what I mean by that is you've got a lot of folks fleeing AI risks, which are valid risks, but we think that they're not taking a special attention to the fundamentals outside of these areas. So, what I mean by that is, let's just take industrials up 15% or so year-to-date. Other cyclicals like energy materials are also up double digits. But take a look at the industrials, earnings aren't really growing. Today, we had two companies report in the kind of industrial area, Genuine Auto Parts, which has an industrial division, basically missed by 10%, issued weak guidance for the year, stock is down double digits last time I checked today. Vulcan Materials, big aggregate leader, same thing, weak report, weak guidance. And so, the industrial EPS estimates for Q1 for the S&P 500 Industrial Sector have actually come down from 10% to just 3% year-over-year growth expected for first quarter, despite again being up 15% or so. Genuine Auto Parts was up 20% year-to-date until today's print, and Vulcan was up about 15%. There's a wide disconnect between excitement and narrative about some of these kind of traditional old-school boring non-AI names and what their fundamentals are actually delivering.