The Canadian industrial stocks stand out as quite intriguing, even as the Canadian economy faces continued challenges going into the year's end and the start of 2025. Undoubtedly, the TSX Index has been rather resilient, even in the face of weak economic data.

With Canada's unemployment rate rising just shy of the 7% mark, the highest it's been since 2017, questions linger as to whether Bank of Canada interest rate cuts will come quickly enough to set the stage for that so-called soft landing. In any case, Canadian investors should continue to play the long game with the types of businesses that can withstand prolonged periods of economic pressures.

Deep value hiding in plain sight!

While AI and tech stocks sell off, perhaps some of the more neglected corners of the market are worth consideration while valuations are still relatively modest. Of course, a medium or hard landing for the economy could mean such economically sensitive industrial stocks continue to face downside risks.

However, at today's levels, I do think the risk/reward profile is worthy for those with a time horizon of at least four to five years. So, let's get right into the industrial powerhouses that can do relatively decent as the Canadian economy looks to progress in this post-inflation world.

As the focus shifts from inflation and high rates to unemployment and lower rates, a different slate of winners and losers stands to be minted. And in this piece, we'll look at two neglected stocks that I think could rise out as winners.

TFI International

TFI International (TSX:TFII) is one of my favourite Canadian industrial stocks to play the long haul. Indeed, the long-haul trucking company tends to be economically sensitive. The better the economy and consumers are, the more demand there will be for transportation and logistics services. And with the company operating in an efficient manner after numerous positive changes made in the past five years, I'd argue that TFI stands out as one of the best ways to play trucking.

The stock is in correction territory, down by just north of 14% from all-time highs. Though coming quarters could prove a choppy ride, I continue to view TFI as one of those best-in-breed companies that will thrive in due time. Of course, the truckers compete with the railways. And though rails are currently a more economical option, I do think the tables will turn in favour of the truckers in due time. Of course, self-driving trucks could give TFI the ability to take market share away from the rails.

That said, autonomous trucks won't be rolling out overnight. So investors will need a very long horizon if they're to profit from the secular trend. In the meantime, TFII stock goes for a mere 25.1 times trailing price-to-earnings (P/E), with a 1.2% dividend yield.

Deere

Deere (NYSE:DE) is an American industrial firm that also stands to benefit from the rise of technology. Arguably, the farming equipment maker is already miles ahead of rivals on the tech front, with intriguing autonomous innovation and resource-saving tech built into the latest and greatest green tractors.

Though the farming scene is under pressure today amid vastly lower crop prices and dwindling farmer incomes, I do think that Deere will be one of the firms that will rise out of the rubble over the long run. As long as Deere stays on top of tech, it looks like a market share gainer.

After doing nothing for three and a half years, DE stock seems like a coiled spring that could pop at some point down the line. For now, shares are deeply discounted at 13.2 times trailing P/E.