Against this backdrop, industry players like TriMas Corporation TRS, Kaiser Aluminum KALU and NN Inc. NNBR are poised to benefit from their proactive cost-management actions and efforts to improve efficiency. Their continuous investments in automation, product innovation and acquisitions are anticipated to contribute to their growth.
About the Industry
The Zacks Metal Products - Procurement and Fabrication industry primarily comprises metal processing and fabrication service providers that transform metals into metal parts, machinery or components used across various other industries. Their processes include forging, stamping, bending, forming and machining, which are used in shaping individual pieces of metal, and welding and assembling to join parts. The companies either use one of these processes or a combination of all. The most common raw materials utilized by metal fabrication companies include plate metal, formed or expanded metal, tube stock, welding wire or rod and casting. The industry players serve an array of markets, including construction, mining, aerospace and defense, automotive, agriculture, oil and gas, electronics/electrical components, industrial equipment and general consumer.
Trends Shaping the Future of the Metal Products - Procurement and Fabrication Industry
Persistent Cost Pressures and Supply-Chain Challenges Remain a Headwind: The industry continues to face elevated costs for labor, freight, fuel and tariffs. Supply chains have also come under pressure following disruptions related to the Iran conflict, adding to overall cost inflation. The ISM Supplier Deliveries Index indicated slower delivery times for the seventh consecutive month in June, highlighting persistent logistics bottlenecks. Meanwhile, the ISM Prices Index was at 73% in June, marking 21 straight months of rising input costs. However, this was down 9.1 percentage points from May's 82.1%, the sharpest monthly decline since July 2022, when it dropped 18.5 percentage points. The index still remains elevated, reflecting higher steel and aluminum prices, tariffs on imported goods and increased petroleum-based product costs stemming from Middle East tensions. To offset these pressures, manufacturers are implementing pricing actions, productivity improvements and cost-control initiatives. Many are also diversifying supplier networks, reconfiguring supply chains and passing on a portion of higher costs through price increases.
Manufacturing Sector Recovery Continues Amid Macro Uncertainties: The Institute for Supply Management’s manufacturing index registered 53.3% in June and has been in expansion since the first half of 2026. A figure of more than 50% indicates an expansion in manufacturing activity. This is a turnaround from the 10-month contraction seen earlier. The New Orders Index has also been in expansion for six months. The Production Index expanded in June for the eighth month in a row. Notably, the fabricated metal products industry was among the few industries to record expansion across all these three indices. Despite the recovery, elevated interest rates, higher fuel costs and ongoing uncertainty surrounding tariffs and global trade policies continue to influence customer purchasing decisions.
Automation & End-Market Growth to Act as Catalysts: A strong emphasis on delivering cost-effective technical solutions and adopting automation to reduce labor dependence and boost efficiency is positioning the industry for future growth. Continued innovation and product development are expected to support this momentum. Expected growth in the end-use sectors, such as manufacturing, aerospace and automotive, is anticipated to benefit the metal fabrication market over the next few years. Rapid industrialization in developing economies also presents growth opportunities, driving long-term demand.
Zacks Industry Rank Indicates Dim Prospects
The group’s Zacks Industry Rank, basically the average of the Zacks Rank of all the member stocks, indicates tepid prospects in the near term. The Zacks Metal Products - Procurement and Fabrication industry, a six-stock group within the broader Industrial Products sector, currently carries a Zacks Industry Rank #204, which places it in the bottom 17% of the 246 Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than two to one.
Before we present a few stocks that you may want to consider for your portfolio, let us look at the industry’s recent stock-market performance and the valuation picture.
Industry Vs. Broader Market
The Zacks Metal Products - Procurement and Fabrication industry has outperformed its sector but lagged the Zacks S&P 500 composite over the past year.
Over this period, the industry has grown 22.3% compared with the sector’s increase of 18.2% and the Zacks S&P 500 composite’s rise of 22.8%..
One-Year Price Performance
Industry's Current Valuation
On the basis of the trailing 12-month EV/EBITDA ratio, which is a commonly used multiple for valuing Metal Products - Procurement and Fabrication companies, the industry is currently trading at 8.65X compared with the S&P 500’s 18.54X and the Industrial Products sector’s trailing 12-month EV/EBITDA of 20.60X. This is shown in the charts below.
Enterprise Value/EBITDA (EV/EBITDA) TTM Ratio
Enterprise Value/EBITDA (EV/EBITDA) TTM Ratio
Over the last five years, the industry traded as high as 13.71X and as low as 4.67X, the median being 8.62X.
3 Metal Products - Procurement and Fabrication Stocks to Keep Tabs On
TriMas: After divesting its Aerospace business, TriMas now operates as a two-segment company centered on Packaging and Specialty Products. It is prioritizing end markets that are positioned for steadier demand and higher-value applications, including beauty and personal care and life sciences within Packaging. The simpler portfolio reduces internal complexity and aligns operating initiatives behind fewer platforms. The aerospace divestiture also provides incremental financial capacity to fund organic investments, pursue packaging-focused acquisitions and repurchase shares. The company continues to evaluate potential acquisition opportunities, focused on expanding its presence in attractive, higher-growth, higher-margin end markets within the Packaging platform, including life sciences. TriMas expects sales growth of 3-6% in 2026 and expects more than 300 basis points of adjusted operating profit margin improvement, driven by cost reductions and realignment initiatives.
The Zacks Consensus Estimate for Bloomfield Hills, MI-based TriMas’ fiscal 2026 earnings has moved up 5% over the past 90 days. The company has a trailing four-quarter earnings surprise of 14.98%. TriMas currently carries a Zacks Rank #2 (Buy).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Price and Consensus: TRS
Kaiser Aluminum: The company reported record net sales, conversion revenues, net income and adjusted EBITDA in the first quarter of 2026. Strong demand and favorable pricing environment drove the top-line improvement while EBITDA growth was driven by a higher value packaging mix, improving aerospace demand, widening scrap spreads and strong customer activity across all end markets, supplemented by metal lag gains. For 2026, the company expects conversion revenues to improve 10-15% and adjusted EBITDA to increase 20-30% year over year. The increase in adjusted EBITDA is due to stronger demand, favorable pricing, improved packaging product mix, disciplined operational execution and cost management, along with metal lag gains. The company has also driven a meaningful reduction in leverage ratio to 2.8x from 3.4x as of 2025-end. The company’s capital investment plans remain focused on supporting demand growth through capacity expansion, sustaining its operations, enhancing product quality and increasing operating efficiencies.
The Zacks Consensus Estimate for Franklin, TN-based Kaiser Aluminium’s current-year earnings has moved up 18.6% over the past 90 days. Earnings estimates indicate year-over-year growth of 44.1%. The company has a trailing four-quarter average earnings surprise of 93.8%. It currently carries a Zacks Rank #3 (Hold).
Price and Consensus: KALU
NN Inc.: The company recently announced that it has received awards to support major OEMs in Ultrasound, Interventional Cardiology, Sports Medicine & Extremity Solutions, and Robotic-Assisted Surgery. Entering the Robot-Assisted Surgery market has been a major breakthrough. With this new customer, medical certification and medical products, the company’s new medical business pipeline has increased in size by around $25 million and is now approximately $75 million overall. Medical Products is one of its five targeted growth markets. The company also recently announced that it has secured a significant amount of additional 2026 immediate-supply awards for liquid cooling products that go into NVIDIA AI data center racks. NN’s combined Data Center and Electric Grid business is its second-largest business, with a goal to grow it into its largest business by sales. The company is undergoing a multi-year program of growing its business into new areas. The five pillars of break-out growth continue to be: data center and electric grid, defense and electronics, medical products, high-value vehicle products and high-value stamped products.
The Zacks Consensus Estimate for Charlotte, North Carolina-based NN Inc.’s 2026 earnings has moved up 45.5% over the past 60 days. The estimate indicates a 633% surge year over year. NNBR has a trailing four-quarter earnings surprise of 85%, on average. The company carries a Zacks Rank of 3 at present.
Price and Consensus: NNBR
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Kaiser Aluminum Corporation (KALU): Free Stock Analysis Report
TriMas Corporation (TRS): Free Stock Analysis Report
NN, Inc. (NNBR): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).