History Says the Great Rotation Is Just Getting Started. 2 Growth Stocks to Buy Now.

Why It Matters

These stocks illustrate how the rotation toward tangible infrastructure can generate high‑growth opportunities, offering investors exposure to government‑backed broadband expansion and the accelerating digitization of industry.

Key Takeaways

• Clearfield sales up 16% YoY, $34.3M Q1 2026
• BEAD program could boost Clearfield demand >20% in 2026
• Belden’s industrial IoT segment growing ~8% annually
• Belden EPS compounding 22.4% versus 7.8% revenue growth
• Rotation favors real‑economy assets over crowded tech names

Pulse Analysis

The so‑called "Great Rotation" is reshaping portfolio allocations as investors move away from speculative tech toward assets anchored in tangible economic growth. Sector indices confirm the trend: the iShares Expanded Tech‑Software ETF has slipped more than 20% this year, while broader measures like the S&P 500 Equal Weight index show industrials and consumer staples posting double‑digit gains. This divergence signals that capital is seeking diversification into infrastructure and real‑economy themes, creating a fertile environment for smaller, less‑followed companies that can capture emerging demand.

Clearfield (NASDAQ:CLFD) exemplifies the type of niche player poised to benefit from policy‑driven growth. The company's Q1 fiscal 2026 net sales rose 16% to $34.3 million, and its gross margin improved by four points to 33.2%. More importantly, the federal Broadband Equity, Access, and Deployment (BEAD) program—an unprecedented $14 billion subsidy—offers a pipeline of projects that could lift Clearfield’s revenue by over 20% in calendar 2026. With the U.S. fiber market projected to expand from $19.1 billion in 2022 to $29.7 billion by 2026, the firm’s modular NOVA Platform positions it to capture a meaningful share of high‑density fiber deployments.

Belden (NYSE:BDC) provides a complementary narrative on the industrial side of the rotation. Its focus on cables, switches, and networking hardware for smart factories, data centers, and edge computing aligns with the 5‑7% annual growth forecast for industrial automation. Over the past five years, Belden’s earnings per share have compounded at 22.4% annually, outpacing its 7.8% revenue growth and highlighting strong operating leverage. The company’s strategic shift from low‑margin commodities to higher‑value IoT solutions promises further margin expansion. While both Clearfield and Belden face execution risk and market volatility, their positioning within government‑backed broadband initiatives and the broader digitization of industry makes them compelling candidates for investors betting on the continuation of the rotation.