These nontech stocks can ride the AI build-out for years

The trend of massive spending on data centers and AI infrastructure is expected to continue, benefiting certain non-tech stocks that provide the necessary hard assets with low obsolescence risk. These companies, referred to as "HALO" stocks, are poised to ride the AI build-out for years to come. Their businesses are characterized by long asset lives and stable cash flows, making them attractive to investors seeking to capitalize on the AI theme without directly investing in tech stocks.

The HALO companies operate in industries such as construction, engineering, and manufacturing, providing essential services and products for the development of data centers and AI infrastructure. As AI adoption accelerates, the demand for data center capacity and computing power will continue to grow, driving spending on these critical infrastructure components. Companies with expertise in areas like electrical engineering, mechanical systems, and construction management are likely to see sustained demand for their services.

To watch next, investors should focus on the quarterly results and guidance from companies in the industrial and construction sectors, particularly those with established track records in providing data center and infrastructure services. Additionally, keep an eye on industry reports and commentary from data center operators and cloud providers, as their spending plans and capital allocation decisions will be critical in determining the growth trajectory of the HALO companies.

Originally reported by marketwatch.com. LargecapNews adds analysis for finance & markets readers.