Goldman Sachs is recommending investors concerned about a slowdown in the artificial intelligence trade to turn to health care and consumer staples sectors. The New York bank estimates that AI capital spending currently accounts for roughly half of S&P 500 earnings growth, but this contribution is expected to diminish as spending growth slows. Tyson Foods stands out with an 11% trailing four-quarter free cash flow yield and a 3.72% dividend yield, while CVS Health offers a 9% free cash flow yield and a 2.88% dividend yield. However, Goldman’s base case remains favorable for continued earnings growth, with a potential catch-up trade in consumer-facing stocks anticipated for 2027.
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