The next AI winners may be these old economy companies embracing the revolution

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Investor Nancy Tengler says a search for more traditional companies embracing digitization could help investors find less ovious beneficiaries of the AI boom.

Investors looking for artificial intelligence beneficiaries outside the megacap tech companies can search in a less buzzy part of markets — old economy stocks. Beyond this year's tech stock leaders such as Nvidia , "it is a broader base in technology" that is set to drive future returns, Nancy Tengler, chief investment officer at Laffer Tengler Investments, said in an interview earlier this month.

Pro's analyst consensus tool shows Emerson has an average buy rating, with almost 24% upside to an average price target of roughly $110. The stock closed Wednesday at $88.83. Another buying opportunity is Xylem , a water treatment company that is expanding its digital capabilities. Notably, Oppenheimer upgraded the stock this month to outperform from perform, saying Xylem's acquisition of Evoqua Water Technologies this year helps set it on a path to 50% digital revenue by 2025.

's Michael Bloom contributed to this report.

 

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