No Robots Allowed

SPEAKER_1 (0:00)

Real assets are increasingly being treated as a structural portfolio allocation, not just a hedge. Electrification, reshoring, and the AI buildout are driving long-term demand for energy, raw materials, and infrastructure. RACS, the Vanek Real Assets ETF, gives investors active, diversified exposure across all of it in one ticker. Visit vanek.com/streetwiseracs to learn more. Investing involves substantial risk and high volatility, including possible loss of principal. Visit vanek.com or call 1-800-826-2333 to read and consider the perspectives containing the investment objectives, risks, charges, and expenses of the fund carefully before investing.

Jack Hough (0:28)

RACS is distributed by Vanek Securities Corporation Are you so into artificial intelligence that you wish you could hear people talking about it for 16 hours a day? If you are, this is probably not the episode for you. This is for the person who just maybe wants a break, just a little reprieve from all the AI talk to hear about some growth stocks out there, some companies that can do well without a ton of AI.

Maybe you're looking for stocks because you feel like your portfolio and has. wandered just a bit too far into the matrix. I'm going to give you some ideas, eight of them in fact. This is the Barron Streetwise Podcast. I'm Jack Hough. Let's get into it.

Listening in is our audio producer, Emily Sumlin. Hi, Emily.

Emily Sumlin (1:24)

Hi, Jack.

Jack Hough (1:25)

We've got some stocks to talk about. I wrote a story for Barron's. This is apart from the column, which by the time people are hearing this, I surely will have written. I was asked to produce a round up of non-AI stocks, and it's not because of any particular investment thesis. It's not because of a prediction that AI is a bubble and it's going to go bust. It's not to say that these are the stocks that you should own instead of the S&P 500 It's just that folks are hearing a lot about AI every week. You got the people arguing about whether it's a fourth industrial revolution or about whether it's a super bubble.

I heard people say it's going to set off a hyper productivity super cycle, which sounds like a good thing, or a crash, which doesn't sound that way. I've heard that it's going to conquer disease and poverty, but I've heard that it might lower the barrier for mass destruction. Sounds like a negative point.

It is all a little bit exhausting.

And so what I did in Barron's was I created a safe space for people who just wanted to read a story without hearing about neuromorphic computing or cybernetic convergence. There were no paradigm shifts. There were some cruise ships moving, no singularity or event horizons. There is a pretty big video game launch to talk about. I couldn't really come up with a list of stocks that were 100% AI free. There's no such thing anymore.

Like there's a broker that's making at least some money because investors are out there flipping things like Direction Daily, AI and Big Data Bull two-time shares and other related nonsense. There's a pair of drug makers, pretty much any drug maker today, any big drug maker is using machine learning to look for new treatments to test. The corrugated box company, they've got a spiel about AI driven efficiency. The gym chain, they'll point you toward an AI coach if that's something you're really into. But I asked AI, and AI told me that my list of stocks has only 7.7% exposure to AI as an investment theme. So that's got to count for something. To find these stocks, we screened across different sizes, sectors, styles. I guess if you wanted to make a non-AI stock list, you might start with value stocks. Barclays Capital just upgraded value and downgraded growth because of higher interest rates, sticky inflation and tighter AI funding. It sounds sensible, but I've always had a hard time telling the difference between a cheap growth stock and a growthy cheap stock. And so, by the way, do growth and value funds judging by the holdings overlap. So we just look for companies with solid prospects for doubling their earnings per share over the next five years. To do that, you have to have a yearly growth rate in the mid-teens or higher. We wanted companies with reasonable valuations so the shares can move with the earnings.

And we look for financial strength to persevere, even if the economy doesn't roar. And we came up with eight names. Again, these names are not a coherent portfolio. They're just a list of individual candidates for consideration. And me going through this exercise of an AI reprieve, I can't stress enough, is not an act of doom saying on my part, unless we end up with doom and then I just remember I've been saying it all along. But I'm optimistic as long as that doesn't happen. Do I have all my bases covered, Emily?