3 Sales Growth Stocks to Buy Despite AI-Linked Market Turbulence

Market Overview - U.S. equities started February on a subdued note, with investors becoming more selective regarding AI exposure, leading to a decline in stocks as the market adjusted high expectations and penalized companies perceived as potential AI "losers" [1] - Retail investors are advised to adopt a disciplined approach by reassessing allocations, tightening risk controls, and ensuring alignment with long-term goals [1] Stock Selection Criteria - Traditional stock selection based on sales growth is emphasized as a more reliable metric compared to earnings-focused metrics [2] - Sales growth is viewed as a clear indicator of a company's underlying momentum, reflecting actual demand for products and services, and can signal future profit potential [3] - Revenue trends should be analyzed in context, comparing growth with peers and industry norms to distinguish between sustainable strength and temporary boosts [4] Screening Parameters for Winning Stocks - Stocks are shortlisted based on a 5-Year Historical Sales Growth (%) greater than the industry average and a cash flow exceeding $500 million [5] - Additional criteria include a Price/Sales (P/S) Ratio lower than the industry average, indicating better value for each dollar of revenue [6] - Estimate revisions for future sales that exceed industry standards are also considered, as they can lead to stock price increases [6] - Operating Margin over the last five years should be greater than 5%, indicating effective cost control and sales growth outpacing costs [7] - Return on Equity (ROE) should be above 5%, ensuring that sales growth translates into profits and that the company is not hoarding cash [8] - Stocks with a Zacks Rank of 1 (Strong Buy) or 2 (Buy) are preferred, as they are known to outperform in various market conditions [8] Recommended Stocks - Genuine Parts Company (GPC) is highlighted, with an expected sales growth rate of 3.7% for 2026 and a Zacks Rank of 2 [9][10] - Wheaton Precious Metals Corp. (WPM) is noted for its expected sales growth rate of 35.4% for 2026, also holding a Zacks Rank of 2 [9][11] - FirstEnergy Corporation (FE) is projected to have a sales increase of 3.6% in 2026, currently carrying a Zacks Rank of 2 [9][12]