How Are the AI-Immune HALO Stocks Doing in 2026?

In February, I wrote about so-called HALO stocks -- stocks of companies with heavy assets and low obsolescence. This was an emerging category of companies that, in theory, should be immune to replacement by artificial intelligence (AI).

The idea of HALO stocks arose in reaction to a Feb. 23 announcement by AI start-up Anthropic that its Claude Code tool could modernize the COBOL programming language, a major asset of International Business Machines. That sent IBM's shares down 13% in a day, the stock's worst single-day loss since 2020.

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It also prompted widespread concern that AI products could eventually replace many other software products, which created a $285 billion rout in stocks with exposure to AI.

The HALO idea resurfaced this week after Anthropic unveiled a suite of 10 new AI agents that can perform a broad mix of financial services tasks like reviewing financial statements and initiating compliance reviews, among many others. Stocks of several financial data companies, including Thomson Reuters and Moody's, sold off on the news.

It's clear that AI, as it reaches into more industries, will continue to impact stock prices.

So, the question now is, how are the HALO stocks I wrote about in February holding up? It's thought that many energy companies, in particular, have significant heavy assets that AI cannot replace or replicate. In addition, due to the insatiable demand for power from AI data centers, these companies are in fact poised to benefit from the growth of the AI industry.

I mentioned ExxonMobil (NYSE: XOM) as a prime example. The stock is up 24% this year, though much of that gain can be attributed to the Iran war, which sent oil prices soaring. Still, it's difficult to imagine at this point how AI can produce, rather than consume, energy. So, this sector remains on the HALO list.

FedEx (NYSE: FDX), another HALO stock, is up almost 30% in 2026. In addition to tangible assets, the company is seen as one that can benefit from using AI to boost its productivity, margins, and profits.

McDonald's (NYSE: MCD) was another stock considered to be in the HALO category because it relies on physical infrastructure that is difficult to replicate. The stock is down about 7% year to date and, in fact, it's down 16% since I wrote that HALO piece in late February.

Despite its many tangible assets, McDonald's, like many other consumer discretionary stocks, seems to be suffering from slowing consumer demand. Consumer sentiment is at a record low, partly due to soaring gasoline prices, which are depressing consumer spending, particularly among the McDonald's customer demographic.

Coca-Cola (NYSE: KO), also on the HALO list, is up 13% year to date. The beverage giant has done well despite slowing consumer spending, thanks to strong execution, brand recognition, and its value as a dividend stock. It also has substantial assets and low obsolescence.

Finally, two construction and agriculture equipment makers were on the original HALO list. I'm talking about Caterpillar (NYSE: CAT) and Deere (NYSE: DE). Both are outperforming the broader market by a wide margin in 2026. Deere has climbed 26%, and Caterpillar shares have soared 59% (the S&P 500 index is up about 7% this year).

These two companies can be seen as pick-and-shovel plays for the AI revolution, as their equipment, from bulldozers to power equipment, is essential to the massive AI build-out.

So, what's the verdict on HALO stocks? They're all very different, of course. And while they all have -- at least to some degree -- heavy assets and low obsolescence, they're still vulnerable to, or can benefit from, broader economic trends such as slowing consumer spending or rising energy prices. And, of course, even companies with HALO-like characteristics will need to execute.

All in all, given the rapid rollout of AI, I still think the HALO concept is one that's well worth keeping in mind when investing.

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Matthew Benjamin has positions in Deere & Company and FedEx. The Motley Fool has positions in and recommends Caterpillar, Deere & Company , International Business Machines, and Moody's. The Motley Fool recommends FedEx and Thomson Reuters and recommends the following options: long January 2028 $320 calls on McDonald's and short January 2028 $340 calls on McDonald's. The Motley Fool has a disclosure policy.

How Are the AI-Immune HALO Stocks Doing in 2026? was originally published by The Motley Fool