These 4 sectors ‘can’t be disrupted’ by AI volatility

Yahoo Finance Video and Josh Lipton

Wed, February 18, 2026 at 9:30 PM GMT+9

In this video:

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GQG Partners portfolio manager Brian Kersmanc joins Market Domination Overtime host Josh Lipton to outline three sectors that he believes are effectively invincible against the recent market (^DJI, ^GSPC, ^IXIC) disruption caused by fears surrounding the artificial intelligence (AI) trade.

To watch more expert insights and analysis on the latest market action, check out more Market Domination Overtime.

Video Transcript

00:00 Speaker A

The theme of these sort of um of the AI disruption fears, right?

00:04 Speaker A

And how it keeps moving. Like first it was software, I mean, which has been shelved. But then you saw wealth management, and then even trucking at one point, Brian, you saw that.

00:13 Speaker A

I mean, how how as an investor do you try to navigate that?

00:16 Speaker A

You go to bed at night thinking you’ve got your money parked in a relatively safe place while you’re dreaming away the night.

00:23 Speaker A

you know, Sam Altman throws a grenade at your vertical, right? You wake up, you’ve been hit hard.

00:28 Speaker A

How do you try and navigate what increasingly probably looks to a lot of folks like kind of a mine field?

00:34 Speaker B

I think what’s interesting in this market, I I think we can all agree that there was a elevated valuations coming into a lot of this. The market overall was at a pretty high valuation.

00:41 Speaker B

I think as you go through and you see some of where these disruption points are coming through, it’s almost an excuse sometimes to to say, okay, let’s sell off a little bit of this because we’re coming in from such a frothy level.

00:50 Speaker B

But realistically, what we want to do is try to go back to, okay, where am I getting real solid earnings, real solid free cash

00:55 Speaker B

flow, where can I get a high single digit, low double digit return and not pay too much for that, you know, level of uh, you know, returns over time.

01:02 Speaker B

And realistically, it also comes back to where am I not necessarily seeing as much of that capital intensity.

01:07 Speaker B

Um and ironically, where I’m finding lower valuations, good returns, good free cash flow, and a little bit less capital intensity, are things like consumer staples, things like energy, things like utilities, um, even things like telecom, which is interesting because in prior cycles, those have been the cap intensive areas.

01:21 Speaker B

But if I compare that to say the hyperscalers, that’s about a third the CAPEX intensity on a CAPEX to sales basis.

01:27 Speaker B

And those are also areas that can’t necessarily be disrupted by everything that’s going on within the AI ecosystem and you’re not afraid of that over spending happening.

01:33 Speaker B

Um so those are areas that we’re definitely finding more interesting and they’re getting a little bit of love, I would say within the last couple of months as well.

01:38 Speaker A

Do you Brian, do you actively kind of screen for that? I’m just curious whether that’s a variable. Like do you think to yourself, hey, before I put money to work, I think, you know, this name or, you know, this vertical would be somewhat more relatively resilient to getting blown up by an LLM.

01:54 Speaker B

Yeah, so what we think about when we’re looking at any one of these stocks is we’re fundamental bottom-up investors.

02:00 Speaker B

And at the end of the day, it’s really three levers that I think about when I buy a stock.

02:04 Speaker B

It’s what is that earnings growth or free cash flow growth? What is the dividend yield I’m going to get from that? And what is the multiple compression risk that I face with that company over time?

02:11 Speaker B

That could be because the the headroom isn’t necessarily there, how much you continue to grow at the pace that you’re growing, or that could be because of some sort of disruption risk.

02:17 Speaker B

And if I kind of use those three sort of vertices, if you will, to think about a stock, that’s where we end up in the portfolio we have now.

02:22 Speaker B

It’s a collection of businesses that I believe gives us the highest probability to achieve a high single digit, low double digit total return and not necessarily get uh punished by either valuation compression or disruption fears.

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