In this article, we discuss the 10 best non-tech stocks to buy now for the long term.
Investing in non-technology stocks offers a range of benefits that can enhance an investor’s portfolio, providing diversification, stability, and exposure to sectors with strong growth potential. While technology companies have often dominated headlines with rapid growth, non-tech sectors have demonstrated robust performance and present compelling opportunities for investors. Diversification is a fundamental principle in investment strategy, aiming to reduce exposure to any single asset or sector. By allocating capital across various industries, investors can mitigate the impact of a downturn in any one area. Non-tech stocks, encompassing sectors such as finance, healthcare, consumer goods, and energy, often exhibit different performance cycles compared to technology stocks. This lack of perfect correlation means that when tech stocks experience volatility, non-tech stocks may remain stable or even appreciate, thereby balancing the overall portfolio risk.
Read more about these developments by accessing 10 Best AI Data Center Stocks and 10 Buzzing AI Stocks According to Goldman Sachs.
As noted in financial literature, a diversified portfolio can have less variance than the weighted average variance of its constituent assets, reducing overall volatility. Recent market data from Fidelity underscores the strong performance of non-tech sectors. Over the past 12 months, large-cap financial stocks have returned an average of 33.7%, outperforming the information technology sector’s 28.1% return during the same period. Year-to-date figures further highlight this trend, with financial stocks within the S&P 500 up 7%, while IT stocks have returned just 1.6%. Within the financial sector, consumer finance stocks have performed exceptionally well, up 54.8%, and banks follow closely with an average return of 51.3%.
Economic policies, particularly deregulation initiatives, have significantly influenced the performance of non-tech sectors. For instance, recent deregulation efforts have been identified as a key bullish theme for the stock market, with financials, consumer goods, commodities, transport, and capital goods sectors benefiting the most. Financial stocks have shown promising year-to-date returns of 7%, outperforming the technology sector’s 3% gain. Investors seeking diversification beyond the US market may find attractive opportunities in non-tech sectors globally. For example, Japanese companies have demonstrated robust corporate earnings growth, with firms like Hitachi, Sony, and Toyota simplifying their structures and focusing on core businesses. These companies have also enhanced shareholder returns through dividends and stock repurchases.
Read more about these developments by accessing 30 Most Important AI Stocks According to BlackRock and Beyond the Tech Giants: 35 Non-Tech AI Opportunities.
For this article, we made a list of non-tech stocks with impressive growth profiles and strong fundamentals. The companies listed below offer a healthy mix of value and growth for investors. These stocks are also popular among hedge funds. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A graph plotting the trends and performance of stocks on the public equity markets.
Best Non-Tech Stocks to Buy Now for Long Term
10. Humana Inc. (NYSE:HUM)
Number of Hedge Fund Holders: 64
Humana Inc. (NYSE:HUM) is a health insurance company. In February, the firm finalized the sale of its elderly care units in Finland after receiving approval from the Finnish Competition Authority. The deal, valued at EUR 25 million on a cash and debt-free basis, includes operations with 430 employees serving 500 clients. In the last year, these units generated EUR 36.4 million in revenue and EUR 2.7 million in operating profit. Humana and Monogram Health also recently expanded their partnership to provide in-home kidney disease treatment. Eligible Humana Medicare Advantage members in Alabama, Louisiana, Mississippi, Tennessee, and now Georgia with CKD or ESKD will gain access to Monogram’s evidence-based, value-based nephrology care at home.
9. Constellation Energy Corporation (NASDAQ:CEG)
Number of Hedge Fund Holders: 85
Constellation Energy Corporation (NASDAQ:CEG) produces carbon-free energy and sustainable solutions. The company reported GAAP net income of $3.82 per share and Adjusted (non-GAAP) operating earnings of $2.74 per share for the third quarter of 2024. In January, the company announced the acquisition of Calpine Corp in a cash and stock deal worth about $16.4 billion. The transaction includes 50 million shares of Constellation stock, $4.5 billion in cash, and the assumption of $12.7 billion in Calpine’s net debt. The merger creates the nation’s top competitive retail electric supplier, serving 2.5 million customers with more energy options, sustainability solutions, and products to help manage costs and meet sustainability goals. The company’s GAAP net income increased to $11.89 per share in 2024, up from $5.01 per share in the prior year.
8. Eaton Corporation plc (NYSE:ETN)
Number of Hedge Fund Holders: 88
Eaton Corporation plc (NYSE:ETN) is a multinational power management company. Operating cash flow for 2024 was $4.3 billion, and free cash flow was $3.5 billion; both represent increases of 19% and 23%, respectively, compared to the same period in the last year. In February, the company announced the completion of a major test labs upgrade in Tczew, Poland. The refurbished facility now features advanced equipment for testing both internal combustion engine (ICE) and electric vehicle (EV) powertrain technologies. It includes two new powertrain dynamometers: a heavy-duty transient dynamometer for developing advanced transmission systems and a medium-duty dynamometer to support powertrain testing for passenger vehicles and light to medium-duty trucks.
7. Pfizer Inc. (NYSE:PFE)
Number of Hedge Fund Holders: 92
Pfizer Inc. (NYSE:PFE) discovers, develops, manufactures, markets, distributes, and sells biopharmaceutical products worldwide. The company reported full-year 2024 revenues of $63.6 billion, reflecting a 7% year-over-year operational growth; excluding contributions from Paxlovid and Comirnaty, revenues grew 12% operationally. In February, the firm announced positive results from its Phase 3 BREAKWATER study, showing that BRAFTOVI combined with cetuximab and mFOLFOX6 significantly improved progression-free survival (PFS) in patients with metastatic colorectal cancer (mCRC) with a BRAF V600E mutation. The combination also showed meaningful improvements in overall survival (OS) compared to standard chemotherapy, with or without Bevacizumab, an anti-angiogenic cancer drug.
6. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 98
Johnson & Johnson (NYSE:JNJ) researches and develops, manufactures, and sells various products in the healthcare field. In the fourth quarter of 2024, sales climbed 5.3% to $22.5 billion, driven by 6.7% operational growth and an adjusted operational growth of 5.7%. In February, the firm announced that the European Medicines Agency’s (EMA) Committee for Medicinal Products for Human Use (CHMP) has recommended expanding the approval of a subcutaneous (under-the-skin) version of RYBREVANT. This version can be used with LAZCLUZE as a first-line treatment for adults with advanced non-small cell lung cancer (NSCLC) that has specific EGFR mutations. It can also be used alone to treat adults with advanced NSCLC who have EGFR exon 20 insertion mutations and didn’t respond to platinum-based therapy.
5. The Progressive Corporation (NYSE:PGR)
Number of Hedge Fund Holders: 100
The Progressive Corporation (NYSE:PGR) is an insurance holding company. The firm reported a net income of $942 million for December 2024, reflecting a 5% increase from $901 million in December of the prior year. In February, Progressive Insurance, a key subsidiary of Progressive Corp, announced its new role as an official sponsor of the MotoAmerica Championship, North America’s premier motorcycle road racing series. This three-year partnership underscores Progressive’s commitment to supporting motorsports and engaging with the motorcycle community to expand its brand presence in the racing world.
4. Eli Lilly and Company (NYSE:LLY)
Number of Hedge Fund Holders: 115
Eli Lilly and Company (NYSE:LLY) develops and markets human pharmaceuticals. In the fourth full quarter of 2024, EPS increased 102% to $4.88 on a reported basis and 114% to $5.32 on a non-GAAP basis, both inclusive of $0.19 of acquired IPR&D charges. In February, the company acquired OliX Pharmaceuticals’ OLX702A for metabolic disease treatment for approximately 900 billion won. According to this contract, OliX must complete Phase 1 clinical trials for OLX75016. Following that, clinical development and commercialization will be handled by Eli Lilly, which will hold exclusive rights.
3. Walmart Inc. (NYSE:WMT)
Number of Hedge Fund Holders: 115
Walmart Inc. (NYSE:WMT) engages in the operation of retail, wholesale, and other units worldwide. The company reported a 27% rise in global eCommerce sales, driven by store pickup, delivery, and marketplace services. In February, Walmart Canada announced it would spend $4.51 billion on new stores, reflecting supply-chain expansion. As part of the initiative, the retailer is planning to open dozens of stores across the country, starting with opening five supercenters in Ontario and Alberta by 2027, two of which are slated to open this year, according to a company announcement.
2. Vistra Corp. (NYSE:VST)
Number of Hedge Fund Holders: 120
Vistra Corp. (NYSE:VST) operates as an integrated retail electricity and power generation company. The company reported GAAP net income of $1,837 million and cash flow from operations of $1,702 million in the third quarter of 2024. The firm is in early talks with major data center developers to upgrade its nuclear plants, including the Comanche Peak facility in Texas, to boost power output. The company is also discussing building new natural gas plants in Texas and the PJM grid (Pennsylvania and Ohio) to support data center projects, according to Chief Strategy and Sustainability Officer Stacey Dore.
1. JPMorgan Chase & Co. (NYSE:JPM)
Number of Hedge Fund Holders: 123
JPMorgan Chase & Co. (NYSE:JPM) operates as a financial services company worldwide. In the fourth quarter of 2024, net revenue rose to $43.7 billion, reflecting a 10% increase, driven in part by non interest revenue, which climbed 29% to $20.3 billion. In December last year, Bloomberg reported that JPMorgan Chase plans to expand its Buenos Aires corporate center, making it a global hub for technology, finance, operations, and legal services. According to the CEO Alfonso Eyzaguirre, the bank aims to hire 1,500 new employees over the next five years, adding to its current 3,500 staff in the city.
While we acknowledge the potential of JPMorgan Chase & Co. (NYSE:JPM) as an investment, our conviction lies in the belief that some stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a stock that is more promising than JPMorgan Chase & Co. (NYSE:JPM) but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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