Tesla has long been a Wall Street favorite, revolutionizing the electric vehicle industry and securing a spot among the 'Magnificent Seven' tech stocks. However, the company now faces challenges such as shrinking margins and a cooling EV market, prompting investors to explore other industrial stocks with stronger growth potential.
Caterpillar stands out as a key player in the AI infrastructure boom. Its third-quarter revenue reached $20.7 billion, up 17% year-over-year, with power generation revenue surging 75%. The company's order backlog nearly doubled to $78 billion, driven by demand for engines and turbines that power data centers. Operating margins improved to 20.4%, and earnings per share rose to $7.13.
Lockheed Martin is benefiting from heightened defense spending, with a record backlog of $292 billion. The company secured a $52.5 billion contract for PAC-3 missile interceptors and raised its free cash flow forecast to $7.8 billion to $8 billion. Global conflicts and a proposed $1.5 trillion U.S. defense budget are fueling demand for its products.
GE Vernova is capitalizing on the surge in electricity demand from AI data centers. Its third-quarter revenue grew 27% to $12.6 billion, with orders nearly doubling organically. The company's backlog expanded to $197 billion, reflecting strong demand for gas turbines and power grid equipment. All three companies, Caterpillar, Lockheed Martin, and GE Vernova, are outperforming Tesla, which is down 13% in 2026.