Two of the best deals in the market … hiding in plain sight …

One is the biggest turbo makers in the world. 28,000 facilities use their automation and control devices to save billions of dollars on energy costs every year.

This company isn’t going away!

But what I like most about this company isn’t the $3.4 billion of cash it generated last year. Nor is it its fat return on equity – at 29.9 percent.

It’s something that is usually considered a big negative. That’s simply not the case for this company. In fact, I consider it the company’s biggest positive.

As I do for another company I’ve had my eye on. It’s another big and powerful company – the U.S.’ 17th biggest manufacturer. And it has its fingers in almost every pie worth mentioning … military, commercial construction, commercial aerospace, and transportation. Plus it’s also in 71 countries. Its return on equity is 25.2 – almost as good as the first company.

But the best thing about these companies is the sector they’re in…

Aviation. And it’s a mess.

Investors have fled the sector as if it’s decades away from getting back to health. They’ve driven down the price of both these well-run companies to ridiculously low levels.

At 40-50 cents on the dollar, you better believe their shares are priced to buy.

Supposedly smart institutional investors miss opportunities like this all the time. They simply rotate out of sectors experiencing difficulties – punishing the strong and weak.

BIG MISTAKE.

These sectors can present wonderful opportunities to those looking hard enough. But investors are often too busy fleeing them to take notice.

For example, when it comes to airlines, investors see companies desperately searching for ways to separate themselves from the free-falling pack.

It’s a little pathetic. Remember when airlines used to offer real amenities like meals? Back then when United said “fly the friendly skies”, it actually meant something.

Now? It’s just a commodity business … getting from point A to point B …

One airline doesn’t charge for carry-ons. Another one does. One airline gives crackers. The other cookies.

Big deal. Nobody cares.

Do you have a favorite airline? Maybe, like me, you have an airline you do most of your flying with because of the frequent flyer miles you’ve accumulated with it.

Mine is Northwest. Believe me, I’m not in love with Northwest. And now that I’ve finally used up most of my frequent flyer miles, I’m free to use other airlines.

Actually, frequent flyer programs were going in that direction anyway. With partnerships and cooperation arrangements entangling several airlines at a time, you’re no longer tied down to one airline through your frequent flyer program.

But wasn’t that the original point of these programs? To keep customers from straying?

If only that was the only problem airlines have. But it’s not…

They’re now cannibalizing their own “parked” planes for parts to save money on repair and maintenance.

In 2008 airlines lost $8.5 billion dollars. This year things were supposed to get better. The International Air Transport Association said in March that losses this year would “only” amount to $4.7 billion.

On June 8 they upped that figure to $9 billion, forecasting that air traffic will slump eight percent this year.

You can’t win for losing. The sweetspot for airlines exists only in the minds of airline executives. In theory, airlines would do swell when the economy has picked up just enough to spur travel but not enough to hike jet fuel prices.

How often does that happen? Hardly ever.

Much more likely is what’s happening today. The economy is showing vague and unsure signs of a coming recovery. It’s just enough to raise fuel prices but not enough to spur air travel.

Despite a new round of new-generation electronics, materials and engines, the aviation industry is facing tough times. Plane makers may have to cut production by as much as 30 percent in the next year. With 66 order cancellations, Boeing and Airbus together have netted just 11 orders so far this year.

The introduction of Boeing’s 787 Dreamliner, Airbus’s A350XWB (extra wide body) and Gulfstream’s amazing new supersonic G650  means a lot of new business for suppliers but not enough to make up the loss of some of the old business.

So, despite glimmers of hope, the aviation sector will have to contract. Many suppliers will fall to the wayside. Many others will be bought out.

It’s not that dissimilar to that is happening in the auto industry.

And that scares investors. But during shakeouts like this one, the strong get stronger as they buy smaller rivals and/or take over their markets.

It’s a great opportunity to take advantage of big powerful companies that the market is ignoring because of the sector they’re in. The two I’ve described more than qualify.

You can find out all about them as soon as you sign up for IDE’s new ETF service.