We recently released a list 15 small manufacturing stock hedge funds are buying. In this article, we will explore the position of ITT Inc. (NYSE:ITT) with other small manufacturing stocks.

Earlier on February 26, Liz Ann Sonders, chief investment strategist at Charles Schwab, joined CNBC’s “Squawk on the Street” to discuss how manufacturing has stalled due to ongoing policy uncertainty. She believes that current market sentiment is focused on concerns about economic growth rather than on inflation. Sonders points to a list of vulnerable indicators such as consumer sentiment surveys, retail sales and service PMI data. She stressed that rising policy uncertainty is also reflected in the intention to reduce the purchase of large capital goods and lead to a pullback in capital expenditure and expenditure plans. Sonders explained that during the past year, between increasing inflation data and growth signals, market output alternated between responses to inflation data and growth signals during the increase and decline. She believes the recent decline in production moves is due to concerns about a slowdown in growth far exceeding expectations for a decline in inflation. This leads investors to prefer more defensive sectors in the market, reflecting a broader sense of caution.

Recent PMI data show that service activity has begun to decline, but manufacturing has played a role. This could lead to potentially positive convergence between the two departments. But Sonders believes that such improvements in manufacturing could be at risk due to policy-related uncertainties still underway. Therefore, many companies in manufacturing are becoming increasingly cautious about future investment and expansion. Sonders also noted that although a substantial reduction in the deficit has been discussed, initially targeting $2 trillion, the actual figures are much smaller. The current visible cuts are less than $10 billion. She believes it is too early to focus solely on tariffs, the impact of immigration and deportation policies and the impact of regulatory changes are collectively upward pressure on growth estimates and inflation expectations. She added that although changes in tax policy are being discussed, these are more likely to affect the year-end outlook than the near-term trajectory.

We first screened the financial media reports, Ishares US Manufacturing ETF, Vanguard Industrials ETF and Insider Monkey’s Q4 2024 Hedge Fund Database Report to compile a list of “Buy Small Manufacturing Stocks.” In this article, we define small-cap stocks as stocks between $10 billion and $20 billion as of April 25. We then selected the top 15 stocks and ranked by the number of stocks in which the number of hedge funds have shares. If an equal number of hedge funds hold two or more stocks, we use market cap as a decisive game.