While innovations such as artificial intelligence have taken off, the “analog” segment of the market – the anti-AI stocks if you will – have fell by the wayside. Frankly, that’s an understandable dynamic given the paradigm-shifting potential of advanced technologies. Nevertheless, you don’t want to ignore the old-school fundamentals.
Yes, seemingly everything in society focuses on science, technology, engineering, and math. However, if the push for innovation occurs without context and a foundation, the impetus will be rudderless. Basically, it’s like building a roof instead of first laying the cornerstone.
Also, because so much attention is paid to the latest fad in innovation, many hot enterprises may succumb to corrections. On the flip side, the overshadowed ideas may rise to the forefront thanks to their predictable and necessary business models. With that, below are three anti-AI stocks for old-fashioned investors.
Waste Management (WM)
You can talk to me all you want about efficiencies and synergies: advanced tech protocols will still lead to trash. Are you still using first-generation smartphones? No, I didn’t think so. Well, the trash fairy doesn’t magically whisk away your rubbish. Instead, we’ve got to really on companies like the self-explanatory Waste Management (NYSE:WM) to handle the mess.
Easily one of the best ideas for anti-AI stocks, Waste Management benefits from permanent relevance. As many sources have pointed out, we’re running out of landfill space. To be fair, I don’t want to come off as a garbage doom-and-gloomer. However, it’s just simple physics. The mass of trash doesn’t just disappear because it’s out of our sightline.
For full disclosure, I wouldn’t classify Waste Management as an enterprise with sterling financials. However, it does benefit from strong margins and consistent profitability. Lastly, analysts rate WM as a consensus moderate buy with a $180.46 price target, implying over 15% upside.
Deere (DE)
Practically synonymous with the agricultural industry, Deere (NYSE:DE) provides the equipment that makes this sector run smoothly: machinery, heavy equipment, diesel engines, drivetrains, and lawn care products. As well, the company provides financial services and other related activities. While it hasn’t exactly performed well this year, core realities should eventually push DE higher.
Also, while Deere represents one of the top anti-AI stocks to buy, it’s not immune to learning new things. For example, the company leverages digital intelligence via its autonomous tractor. So, in that sense, it’s both pro-AI and anti-AI simultaneously.
Financially, Deere brings a credible profile to the table. Its three-year revenue growth rate clocks in at 11.8%, above 66.67% of its peers. As well, its three-year EBITDA growth rate during the same period impresses at 18.6%. Plus, Deere is consistently profitable, reflecting the predictability of its business. Analysts rate DE a moderate buy with a $446.50 target, implying over 14% growth.
Weyerhaeuser (WY)
A forestry specialist, Weyerhaeuser (NYSE:WY) isn’t exactly going to make the Christmas card list for those supporting environmental, social, and governance (ESG) initiatives. Historically, the underlying industry incurred much criticism for unsustainable practices. However, it would also be unfair to suggest that enterprises like Weyerhaeuser haven’t learned from prior missteps.
Also, we’ve got to be honest about forestry. When done responsibly, the industry can help the broader ecosystem by ridding itself of unnecessary elements such as underbrush and weak or dead trees. Through this management, Weyerhaeuser and its peers help reduce forest fires. Of course, the underlying lumber product is vital for the housing and construction sectors.
From a financial perspective, the company benefits from a strong three-year revenue growth rate of 16%, above 90% of rivals. Also, its free cash flow growth rate pings at 52.8%, better than over 93% of sector peers. Finally, analysts rate WY a moderate buy with a $38.57 target, implying over 28% upside.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.