(FORTUNE Magazine) – -- APPLIANCES: Still spinning. The heady growth of the past two years will slow a bit in 1987. But according to Charles K. Ryan, a security analyst for Merrill Lynch, shipments will still rise 2% to 3% over last year's record 46.3 million units. Microwaves, up 14% last year, show no sign of reaching the peak everyone has been predicting -- though imports are snagging most of the growth. The prime movers for appliance sales are families on the move. That force will continue to be felt in 1987 as single-family housing starts and resales of existing houses nearly offset a slowdown in new apartment construction. Replacement purchases by stay-at-homes will also be important. Ryan expects the industry's profits to jump 15% to 20%. The major share will go to the big companies that can outfit a home from the kitchen to the laundry room. One-stop shopping makes life easier for the contractor building or remodeling a house. For companies able to ride the housing wave, says Ryan, ''the story of this industry continues to be record earnings on top of record earnings.''

-- CARS: Losing momentum. The industry racked up its fourth straight record- breaking performance in 1986, selling 11.4 million U.S-made cars and 4.8 million trucks. Is a fifth in the cards? ''It's hard to imagine,'' says industry guru Maryann Keller of Furman Selz Mager Dietz & Birney. ''Everybody's got a new car or truck.'' She thinks the Big Three's profits will take a drubbing in 1987. FORTUNE expects that car sales will taper to 10.5 million, and truck sales will inch up to five million. The first quarter will be the worst; consumers are winded after the summer's cut-rate financing spree and the December rush to get the sales tax deductions that expired with the new tax law. Detroit will doubtless court buyers with more incentive schemes. Imports will score modest market share gains; they claimed 29% of the car and truck market last year, up from 26% in 1985, and Keller expects their sales to be up another 100,000 units in 1987, from 3.2 million to 3.3 million. Brazil, Korea, and Europe will gain disproportionately, at the expense of Japan. Alan K. Binder, managing editor of Ward's Automotive Reports, anticipates ''a real dogfight'' at the bottom end of the market during the second half as importers bring in a new crop of minicars to compete at the $5,000 level.

-- HOUSING: Cooling. After four years of strong growth, the housing industry is finally headed for a slowdown. FORTUNE predicts that starts will fall from 1.8 million units in 1986 to 1.65 million this year. Multi-unit builders will hurt the most; apartments, which account for a third of the market, are overbuilt in nearly every area of the country, and vacancy rates are at a 20- year peak of 10%. Apartment starts will plunge nearly 30% this year, to 460,000. The industry's litany, according to Stephen Albert, a security analyst at Kidder Peabody: ''Single-family will hold up; multifamily will fold up.'' By FORTUNE's estimate, single-family starts will stay on their high plateau of 1.2 million units annually. Business is best in the Northeast.

-- CLOTHING: Fighting the imports. Last year consumers bought a heap of fleece, industry jargon for those hot-selling jogging suits that now rival jeans as the uniform for casual attire. But in general, sales of U.S. apparel manufacturers remained flat at $65 billion, and FORTUNE predicts that they will rise only 4% in 1987. Other industry watchers are more upbeat. Jay J. Meltzer, an analyst at Goldman Sachs, is betting that sales will rise 8% and profits ''will make a big jump, up 30% to 35%.'' Meltzer figures consumers will shy away from big-ticket durables, since sales tax and interest deductions were eliminated by tax reform, and so will spend more on their wardrobes. To win customers back from imports, the industry is also modernizing plants, paying more heed to service, and pounding away with ''Buy American'' campaigns. Joseph Scheines, an economist at Kurt Salmon Associates, thinks that 1986 was the peak year for import growth, and expects it to slow from last year's 14% to 9% in 1987.

-- CHEMICALS: High spirits. After one record year, why not another? Basking in the luxuries of lower feedstock expenses, the falling dollar, and widespread cost reductions, the chemical industry saw profits rise 35% to 40% in 1986. This year should bring another 20% to 25% jump, according to William Young, an analyst with Drexel Burnham Lambert. Adds Richard Stuckey, chief economist for Du Pont: ''Feedstock costs have been improving since 1981, and the improvement became dramatic in early 1986 with the sharp drop in oil prices. Historically, whenever this happens, you see higher production.'' In 1987 production and revenues will increase 4% to 5%.

-- AEROSPACE: Leveling off. Aircraft deliveries are strong, and the friendly skies are full of travelers. On the face of it, 1987 should be the industry's fourth consecutive banner year. But look closer. The weaker dollar has helped exports slightly, but its benefits have been offset by price cutting in a rough competitive market that now includes a strong European player, Airbus Industrie. Aircraft deliveries will rise 12% in 1987, but earnings will fall modestly. Defense contractors will suffer a similar squeeze for different reasons. In the tough new world of flat military spending, the Pentagon is requiring suppliers to put up more money for everything from research and development to start-up capital for new weapons systems. Moreover, much of the industry is moving from the profitable production of old systems to the less lucrative development of new ones -- all at a time of zero growth in the defense budget. The industry, says Wolfgang Demisch, an analyst for First Boston, ''has had as much of a taste of honey as it's going to have for some time.''

COMPUTERS AND ELECTRONICS: On the rebound. After two tough years for the computer industry, corporate buyers should be shopping again in 1987. The Commerce Department predicts that dollar sales will grow about 10%, with micro- and mini-computers leading the way. Mainframes will have the toughest time (see page 34) as companies seek more processing bang for their bucks in increasingly powerful small computers. Ulric Weil, who heads his own consulting firm, reckons that earnings will increase about 10% for hardware manufacturers and 15% to 20% for software makers. ''Software is the most vibrant part of the industry,'' says Weil. Semiconductors should enjoy a modest rebound. Demand is expected to pick up this year, and a 60% increase in the value of the yen means that U.S. producers can finally compete with the Japanese. Michael Gumport, a security analyst with Drexel Burnham Lambert, expects U.S. production to rise from about 45% of capacity to 80% by the end of the year. That's more than demand will rise. But production efficiency perversely falls sharply when chipmakers crank up volume, says Gumport, and plant closures have reduced capacity since last year. Still, the industry can expect a 20% jump in revenues -- and some real, if razor-thin, profits.

-- TELECOMMUNICATIONS: On hold. Look for the Baby Bells to slow down and the independents to speed up. Charles W. Schelke, a security analyst with Smith Barney Harris Upham, predicts about 6% earnings growth for the regional telephone companies this year and about 8% for independents like GTE. That will not be enough to bail out equipment manufacturers. The field remains grossly overcrowded and underutilized. (Makers of fiber optics are working at about 30% of capacity.) Demand should remain weak until capital spending picks up again, perhaps by midyear. Companies that avoid red ink will do so primarily through cost cutting. Says Maria Sbrilli, who follows the equipment manufacturers for Smith Barney: ''What this industry needs is volume, but there is no sign of any in the near future.''

-- INDUSTRIAL EQUIPMENT: In the doldrums. Machinery's dull days will grind on, brightened only by the expected upturn in manufacturing in 1987. Says Mitchell Quain, a security analyst with Wertheim & Co.: ''I see a revival for companies whose fortunes are tied to industrial production -- makers of cutting blades, paint pumps, electrical connectors, and so on.'' But times will be tough for some industries. In oil, for example, low prices have brought drilling in the U.S. practically to a halt and are not likely to rise enough to matter. The cheaper dollar will help companies that did not move production out of the U.S. when the greenback was strong. Unfortunately, many did. Once the smoke clears this year, earnings will probably have risen less than 10%, from already depressed levels.

-- PAPER: Help from the dollar. The boom that began last year when the dollar / headed down will continue into 1987. Exports are roaring back, and imports, which grew to 15% of the market by 1985, have crested. The big gainers in 1986 were pulp and linerboard. Prices will remain strong in 1987, and producers will get increases averaging 6% across the board, says Evadna Lynn, who follows the industry for Merrill Lynch. FORTUNE expects inflation-adjusted sales to grow 2%, and industry watchers predict that profits for the heavyweights will grow at a dazzling pace of 40% to 60% on volume increases of around 3%. The dampened dollar is not the only reason. Manufacturers have been cutting costs, and wage increases are slowing to a crawl. Norma Pace, senior vice president of the American Paper Institute, says that the average labor contract calls for increases of 1% to 2% in 1987. ''That's a big improvement over the double-digit raises of a few years ago,'' she says. Paper company shareholders, who have been on a starvation diet for years, could perhaps be pardoned if they said turnabout is fair play.

-- STEEL: Two-tier prospects. The strike that shut U.S. Steel down from August through the end of the year was a pungent testament to slack demand. Not only did prices remain soft, but shipments for the rest of the industry fell 1%. ''There was little evidence that 17% of the industry wasn't functioning,'' says Peter L. Anker of First Boston. FORTUNE expects shipments to rise as much as 5% in 1987, but Anker predicts another gloomy year for major steel companies. In contrast to the big integrated producers, the highly efficient mini-mills are pouring steel furiously.

-- OIL: On the mend. For big oil companies, if not consumers, OPEC's pre- Christmas price-fixing agreement was at least a stocking stuffer. Says John Lichtblau, head of Petroleum Industry Research Foundation: ''We'll see some volatility in 1987. Prices could fluctuate between, say, $15 and $20 a barrel. But the trend is upward.'' That will be too little too late for many independent producers, who need prices above $20 to survive. But the big integrated companies can expect a 10% rise in revenues this year. Ironically, that may not translate into higher profits. Says Philip Dodge, a security analyst for Donaldson Lufkin & Jenrette: ''The plunge in crude oil prices last year raised margins for refining and marketing, because it took time for downstream prices to catch up. So the big international companies did better than everyone expected. They may not do as well as everyone expects in 1987.'' Dodge predicts that their earnings will be ''about the same'' as last year.

-- AIRLINES: Watching for downdrafts. The industry soared to recovery during the second half of 1986 after losing a record $669 million in the first quarter. Profits for the year came to $1.4 billion, about even with last year. Most observers expect the airlines to pick up more speed in 1987 -- at least if they don't savage each other with fare wars. Two-tier labor contracts are helping to hold labor costs down for almost half of all U.S. carriers. Lower fuel costs seem a faint hope now. But even if oil prices settle at recent levels, says Lee Howard, executive vice president of the Washington, D.C., consulting firm Airline Economics, traffic will increase 7% and revenues 8%.

-- TRUCKING: The triumph of the strong. The long post-deregulation shakeout flattened almost everybody's tires, but the survivors are now rolling. For the industry as a whole, profit margins hit 2.8% in 1986, the best in eight years, despite level tonnage. Two companies with combined revenues of $600 million, McLean Trucking and Hall's Motor Transit, bit the dust, and the beneficiaries were big, well-managed competitors. ''Somebody had to haul the leftover freight, so the rich got richer,'' sums up Craig Kloner of Goldman Sachs. Kloner expects further consolidation over the long haul, meaning still more gains for the big boys. Others with bright prospects include aggressive new small companies who specialize in picking up business from corporations that are unhitching their in-house hauling operations. But the rest of the industry could be stalled by lackluster consumer spending; FORTUNE estimates that revenues will remain flat. Most analysts agree and think that margins may contract slightly from 1986 levels.

-- BANKS: Generally shipshape. After devoting last year to cutting costs and beefing up reserves against loan losses, banks should be able to reap better profits in 1987. James J. McDermott Jr., head of research at Keefe Bruyette & Woods, predicts a 10% increase in earnings for the 170 biggest banking companies. But they will not be making many new loans. ''The economy isn't strong enough to support strong growth in lending,'' he says, ''and the largest banks are selling off many of their loans. So on paper, total assets will appear to be flat.'' Almost no one expects the new Congress to expand banking's legal playing field. ''Congress has dropped the ball repeatedly in recent years,'' says McDermott.''It lacks an overall game plan for financial services.'' The most likely actions: a move to ban so-called nonbank banks, which make commercial loans but do not take deposits, and greater powers for regulators to help healthy banks buy out unhealthy ones. At year-end, bankers were cheering a court victory that could significantly broaden their business. A federal court of appeals ruled that banks can be primary dealers in commercial paper, a $150-billion market that is growing fast. The other party in this fight, the Securities Industry Association, will probably appeal to the Supreme Court.

-- ELECTRIC UTILITIES: Generating cash. Rising economic activity will boost inflation-adjusted electricity sales 2% to 3% this year, by FORTUNE's estimate. Though regulators have been sharply cutting the rates of return they allow the utilities to earn on equity, security analysts expect profits to rise about 3% largely because the industry's huge capital expenses are declining rapidly. Roughly 80% of the companies with costly nuclear plants and other construction projects are finished now. As more nuclear programs wind down, capital expenditures will drop another notch. ''Some 30% of electric utilities are already self-financing or generating excess cash flow,'' says Ernest Liu of Goldman Sachs. Over the next 18 months, he believes, the number will increase to 60%. Many will pump the money into such diversification ventures as banking and insurance.