Goldman Sachs states that in an era defined by artificial intelligence disrupting markets, rising real yields, and a fragmenting geopolitical landscape, investors are increasingly favoring stocks characterized by a "HALO effect"—heavy assets and low obsolescence.

Strategists at Goldman Sachs, including Guillaume Jaisson, wrote in a report that the market is rewarding assets possessing capacity, networks, infrastructure, and barriers in engineering technology. These assets are costly to replicate and are less vulnerable to being phased out by technological iteration.

A basket of capital-intensive stocks compiled by Goldman Sachs has outperformed a portfolio of light-asset stocks by 35% since 2025. Asset intensity is becoming a core driver of valuation and returns.

The firm noted that fiscal expansion, rising replacement costs, industrial reshoring driven by regionalization, and a rebound in manufacturing all benefit capital-intensive sectors.

Persistent inflows into value-oriented strategies, coupled with investors' desire to diversify away from crowded US tech stocks, are further driving a rotation towards capital-intensive assets. The long-term allocation to such assets remains far from excessive, according to the report.

There is a broad market expectation that earnings per share (EPS) growth for capital-intensive firms will accelerate, with return on equity (ROE) showing continued improvement. In contrast, the ROE for light-asset stocks is projected to remain stable.