3 HALO Stocks to Buy Now

• (0:15) - Where To Find Strong Growth Stocks Outside Tech?
• (3:50) - Top Stock Picks For Your Watchlist Right Now
• (20:30) - Episode Roundup: CAT, MTZ, URI
•                 [email protected]

Welcome to Episode #495 of the Zacks Market Edge Podcast.

Every week, host and Zacks stock strategist, Tracey Ryniec, is joined by guests to discuss the hottest investing topics in stocks, bonds, and ETFs and how it impacts your life.

This week, Tracey went solo again to look at what companies are benefiting from the big spending on the AI Revolution. The hyperscalers have gone all in. They are expected to spend a trillion dollars, or more, in just 2026 alone to build out the AI infrastructure, which includes data centers, the power to run them, cooling them, and filling them with racks and chips.

Everyone knows the semiconductor trades but what about those who are on back end?

Investors should follow the money. Who is getting the contracts to build and power the data centers? That’s who you want to invest in. Those companies are growing their business.

Definition of a HALO Stock

What’s a “HALO” stock?

HALO stands for “hard assets, low obsolescence.” Basically, the company makes something that is a real product and it’s a product that has been in use for decades. It’s not a flash in the pan.

Tracey likes to call these companies the “old economy” companies because they have been in business for decades and are in the “old” industries like railroads, heavy equipment, and utilities.

These “old economy” companies are now seeing a renaissance as they capture business from the hyperscalers who are building data centers and the power generation that goes with them.

3 HALO Stocks to Buy Now

1. Caterpillar Inc. (CAT)

Caterpillar recently reported second quarter 2026 results and saw sales jump 24%. It’s backlog rose 92% year-over-year to $72 billion. Not only does Caterpillar make construction equipment but it also manufactures industrial gas turbines, which are being used to power data centers.

Earnings of Caterpillar are expected to rise 30.5% this year and another 25.2% in 2027. Shares of Caterpillar hit new all-time highs earlier this year but have fallen 13% in the last month. It now trades with a forward price-to-earnings (P/E) ratio of 35. A P/E over 30 is considered high.

Should a HALO stock like Caterpillar be on your short list?

2. MasTec, Inc. (MTZ)

MasTec is an engineering and construction company in the United States that is involved in key infrastructure projects in power delivery, pipeline infrastructure, clean energy including renewables, as well as communications.

MasTec had a record backlog of $21.4 billion, up thirty percent year-over-year, as of the end of the second quarter of 2026. It continues to see strong demand this year.

Earnings are expected to rise 41.2% in 2026 and another 35.3% in 2027. MasTec shares have plunged in the last month, however. It’s down 33.1% in that time as investors cash in profit on the AI trade. MasTec trades with a forward P/E of 28.8.

Should a HALO stock like MasTec be on your short list?

3. United Rentals, Inc. (URI)

United Rentals is the largest equipment rental company in the world. Most of its business is in North America, where it operates in 49 U.S. states and all Canadian provinces, but it also operates in Europe, Australia, and New Zealand.

United Rentals reported record results for the second quarter of 2026 and raised full year earnings guidance. Growth accelerated in the quarter with customers being optimistic, especially around large projects.

Earnings are expected to rise 15.4% in 2026 and 14.2% in 2027. Shares of United Rentals are at new all-time highs. Unlike MasTec and Caterpillar, shares are up in the last month, gaining 5.8%.

United Rentals has a forward P/E of 23.9. While that isn’t low enough to make it a value, it’s more attractive than MasTec and Caterpillar on a P/E basis.

Should a HALO stock like United Rentals be on your short list?

What Else Should You Know About Buying HALO stocks right now?

Tune into this week’s podcast to find out.

[In full disclosure, Tracey owns CAT in the Zacks Insider Trader and MTZ in Zacks Value Investor portfolio.]

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This article originally published on Zacks Investment Research (zacks.com).

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