Deals in Construction-Equipment Stocks

Beaten down amid fears of a global slowdown, shares of two heavy-machinery makers look attractive. Plus, a high-flier worth considering.

Stocks of construction-equipment makers seem particularly productive waters for bottom fishing. Their shares have been blasted as evidence of a weakening economy mounts. That's because making heavy machinery is a highly cyclical business that tends to decline as the economy slows. Less construction means less demand for bulldozers, cranes and dump trucks. The on-going collapse of the U.S. housing market has exacerbated the decline of construction-equipment stocks.

Two battered equipment stocks are worth a look, as is one that has remained relatively unscathed. Terex (symbol TEX), Manitowoc (MTW), and Bucyrus International (BUCY) manufacture equipment needed to extract commodities, such as oil, copper and coal.

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Contributing Editor, Kiplinger's Personal Finance