Industrials have been on a stealth rally as a proxy for the U.S. economy. One of my big themes has been intermodal container carriers that are easily lifted off ships onto rail cars and trucks, and one of my favorite names in the space right now recently reported earnings.

Navistar International (NAV), a well-known company that makes trucks, buses and service parts, released its first-quarter numbers on Tuesday. The company earned $0.55 a share on revenue of $2.42 billion. The bottom line was up big from a loss (yes, a loss) of $0.86 a share last year and beat the consensus at $0.34. While the top line was a little lighter than expectations of $2.44 billion, it still represented solid 15% year-over-year growth.

NAV was number four in market share, but management’s comments suggest they gained share during the quarter. Moreover, management was able to hike guidance based on macro developments and micro industry trends. Expectations are now for revenue of $9.75-$10.25 billion, all of which is ahead of the Street at $9.64 billion.

Most encouraging is the pace of retail truck orders – NAV is a leading maker of trucks, including Class-8 trucks, or “18 wheelers” or “semis” as they are sometimes called. The company’s numbers match up with the two key industry research firms. ACT Research reported that truck orders increased 2.5% in May and were up 110% year-over-year and 2.5% from the previous month. FTR, whose research I incorporate into my modelling, actually saw a pullback in April but reported numbers still up more than 50% from a year earlier.

The one fly in the ointment that kept a lid on the stock the day of the report – it closed down 0.5% after being up as much as 7.5% in very early trading – was management’s statement that profit margins are likely to shrink. Revenue in the higher-margin auto parts business is expected to remain flat, and even though truck sales are solid, they generate smaller profits. Commodity costs are also up, and because truck demand is so strong, Navistar has used costlier transportation modes to keep its factories supplied.

NAV has trended higher the last couple of months, bouncing sharply off its late-March lows although still with some ups and downs along the way. I like that buyers stepped in on Tuesday as the stock reversed nicely off its lows and that it bounced almost 3% the following day to close above Monday’s price before earnings came out.

I see a real turnaround in execution as the company moves into profitability, and that combined with economic strength makes it one of those great companies well-positioned for long-term gains. see this stock higher over time.