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Our Outlook for the Business-Services Sector

This sector is home to several undervalued gems.

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Morningstar's coverage of business-services firms runs the gamut of industries from waste collection to transportation, but a few key themes are important for investors to keep their eye on. As the sector name implies, these companies provide services to other businesses and are therefore tied to the economic cycle, though the exposure differs significantly across the business-services universe. We think the cash-rich and steady-eddy business models of many waste haulers are relatively recession-resistant, while engineering and construction (E&C) firms and airlines rank at the top of our list of companies levered to changes in the global economy.

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Brian Nelson does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.