AI is transforming an unlikely industry, turning mountains of discarded materials into a potential new source of earnings growth.
Listen to the audio version of this article (generated by AI).
Hello, Reader.
Artificial Intelligence, meet Circular Economy. I think the two of you are really going to hit it off.
A circular-economy company doesn’t just sell products. It extends their life, recovers their value, or turns waste into feedstock.
Instead of the old linear model – make → use → discard – these businesses operate on a loop:
- Collect used or discarded materials.
- Sort and grade them.
- Recover valuable components.
- Resell, recycle, or repurpose what remains.
For years, this was a niche, tree-hugging concept. Today, it’s becoming one of the most compelling profit pools in the global industry.
But there’s a catch.
Companies that live in the circular economy operate in messy, unpredictable environments that traditional software struggles to handle.
Many of the raw materials arrive in garbage bags, donation bins, scrapyards, and decommissioned data centers. One moment it’s a frying pan. The next it’s a rusty automobile. Or a cracked smartphone. Or a server rack full of aging memory chips.
Historically, this realm of unstructured “feedstock” has resisted automation. Software didn’t know how to value a used jacket, grade a bruised apple, or distinguish high-quality scrap metal from low-grade waste. Humans had to do that work – slowly, inconsistently, and expensively.
That’s now changing.
Artificial intelligence is finally giving circular-economy companies the missing ingredient: a way to organize chaos at scale. For example, AI could help a recycling or resale company sort materials faster, price items more accurately, reduce labor costs, and recover more value from each item. And, importantly, boost profit margins and earnings growth in the process.
That shift has the potential to unlock margin expansion every bit as powerful as what AI is doing for digital businesses.
Below I’ll share the name of a company operating in the circular economy that shows how AI can turn chaos into profits.
But first, let’s review our latest Smart Money stories exploring just how broad the AI opportunity has become – from the growing number of AI winners… to the picks-and-shovels behind humanoid robots… to the traditional companies putting AI to work in the real world.
Smart Money Roundup
AI Has More Winners Than Ever – Here’s the Catch
August 19, 2026
Profiting from the AI boom used to be easy for investors. In many cases, simply buying the companies powering the world’s data centers was enough to make you a winner. But AI’s rapid spread is creating more opportunities, making stock-picking more complicated. Read Luke Lango’s piece for more on how portfolio size and diversification have become vital to finding success in the AI trade.
Usain Bolt Just Got an AI Rival – Meet the Stocks Behind It
August 20, 2026
Unitree Robotics’ launch of its “Superman” humanoid robot not only challenged Usain Bolt’s 12.4 meters per second record, but also highlighted new investment opportunities in AI-powered robotics. Each humanoid robot requires a “brain” (AI processors and software), “eyes” (cameras and sensors), “muscles” (motors and motion-control systems), and “joints” (gears and bearings), offering many picks-and-shovels investment plays.
To discover more about the suppliers of these components and how to effectively organize them in your portfolio, click here.
Target Just Named Its First AI Chief — Here’s Where the Money Goes
August 22, 2026
Nearly four decades after Target adopted barcode scanning, it is now embracing another revolutionary strategy that could prove just as transformative: artificial intelligence leadership. Target’s chief AI officer, or CAIO, now manages the company’s overall AI strategy and aligns it directly with goals to enhance revenue, reduce costs, and promote growth. Here’s what this development means for Target and its impact on the wider AI field.
Here’s What NVIDIA’s $500 Billion “Checkmate” Means for Investors
August 23, 2026
There’s much to learn from CEO Jensen Huang. Every dollar Nvidia invests can help remove one of the biggest bottlenecks facing the AI growth: access to compute. And every new data center built with Nvidia hardware reinforces its ecosystem, making it more difficult for competitors to displace it. Currently, Huang is helping develop a financial infrastructure that allows customers to keep investing in Nvidia and benefit from the AI Revolution.
AI Goes Thrifting
As the largest “for-profit” thrift store operator in North America, Savers Value Village Inc. (SVV) processes billions of pounds of donated goods annually. And the company has begun embedding machine-driven systems into that flow – starting with Automated Book Processing (ABP).
This innovation marks Savers’ first step toward AI-enabled inventory management.
The ABP system works like a high-speed automated assembly line for used books. As books move along a conveyor belt, scanners read each ISBN and check a database of 55 million books to determine their market value. A robotic arm then prices and sorts each book into the appropriate category — all without stopping the line.
The benefits are clear: faster processing, better pricing, lower labor costs, and the ability to handle more donations. As of early 2025, the system was in about 170 Savers stores. Today, it’s in more than 300 — roughly 85% of all Savers stores.
The ABP system is not yet a company game-changer. But as one of America’s mightiest trillion-dollar companies demonstrated – Amazon.com Inc. (AMZN) – starting with books is not a bad approach.
The potential is clear. Imagine AI that can instantly recognize a product’s identity and condition, estimate its value, send valuable items to the right stores, and predict where and when they’ll sell best.
The circular economy is one example of how the AI opportunity is becoming much bigger – and much more complicated – than simply buying the companies building AI models and chips. AI is now finding applications in industries as messy and physical as recycling, where machine intelligence can turn previously unstructured processes into scalable businesses.
And as the number of potential AI winners continues to grow, identifying the best opportunities becomes increasingly important.
That’s exactly what my InvestorPlace colleagues Louis Navellier, Luke Lango and I address in our brand-new special presentation. In the video, we reveal how we’ve narrowed hundreds of AI opportunities down to the stocks we believe are worth owning now.
Click here to watch our free broadcast.
Regards,
Eric Fry
5 Stocks Our Experts Predict Could Double In the Next Year
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