When you think of stocks and innovation, most of the time a technology company comes to mind. However, almost every successful company has to prove that it has the ability to innovate at some point, often in surprising and unexpected ways. That can be just as true of a century-old food company as of a Silicon Valley start-up. 

We asked three of our contributing investors to offer up a company that they think could make for a solid investment right now that's also showing its innovation chops. They gave us two that may surprise you -- 125-year-old food purveyor Hormel Foods Corp (NYSE:HRL) and low-cost retail behemoth Wal-Mart Stores Inc. (NYSE:WMT) -- and one that's more of a typical innovator in First Solar, Inc. (NASDAQ:FSLR)

Engineers working in a laboratory.

Innovation can come from surprising places. Image source: Getty Images.

Ready to add some innovation to your portfolio? Keep reading to learn what makes these three stocks innovative leaders and more importantly, why they're worth investing in today. 

A surprising source of food innovation

Reuben Gregg Brewer (Hormel Foods Corp): Hormel makes some of the most beloved foods in the world, like SPAM (I'm not joking...people love SPAM). However, it isn't that decades-old food product that makes Hormel innovative -- it's all of the other stuff it's been doing of late. Innovation isn't just for tech companies!

For example, after Hormel bought the boring old Skippy peanut butter brand, it launched P.B. Bites. That shifted peanut butter from a spread to a snack that you can carry around with you. After buying Wholly Guacamole, it expanded the line with layered dips. It's also created an entire line of foods, called Vital Cuisine, to help patients dealing with serious medical issues meet their unique nutrition needs. Those are just a few recent examples. Innovation is actually a stated corporate goal and one piece of the equation that's allowed Hormel to increase its dividend annually for an incredible five decades.

HRL Dividend Yield (TTM) Chart

HRL Dividend Yield (TTM) data by YCharts.

That dividend, meanwhile, is part of the reason why now is a good time to look at Hormel. The food industry is under pressure today from changing consumer tastes, and that's pushed Hormel's shares down to the point where they yield around 2% -- toward the high end of its yield range over the past 15 years. It's a nice yield and a fair price for those looking to find innovation outside of the technology space.

The retailer driving the omni-channel revolution

Chuck Saletta (Wal-Mart): Retailing giant Wal-Mart may not be the first company that comes to mind when you think of innovation, but right now it's giving you good reason to consider it. The world's largest retailer is clearly flexing its innovative muscle as it creates a commanding omni-channel shopping experience. Last month, Wal-Mart reported strong earnings and raised its guidance, thanks to the enhanced integration of its stores with its online presence.

Smiling woman with shopping bag looking at her smartphone.

Image source: Getty Images.

A key driver of that current strength and the optimism for the future is the way Wal-Mart is leveraging its recent acquisition of online retailer Jet.com to enhance its online presence. The company is now piloting things like employee delivery of online purchases and same-day pickup in store, which helped boost online sales by 60% compared to last year. Much of that online growth is incremental compared to its physical store results, which is helping fuel more effective use of Wal-Mart's physical presence.

Wal-Mart is delivering end-to-end profitable growth by leveraging both its physical stores and its online marketplace. It is showcasing the potential that a strong omni-channel retail strategy can have to enable physical retailers to not only survive but also thrive in today's era of digitized shopping. That ability to profitably innovate for growth, combined with Wal-Mart's still reasonable price of around 17 times expected earnings, makes it worth considering owning today.

A solar leader investing in more innovation

Jason Hall (First Solar, Inc.): Solar panel manufacturers have made huge leaps forward over the past decade. Panels are cheaper and more efficient today than they've ever been, helping make solar more cost-competitive with traditional power sources like coal and natural gas. And panel makers continue to push the limits, squeezing more and more efficiency, even as costs fall. 

Large utility-scale solar project seen from the air.

Image source: Getty Images.

One of the leaders is First Solar, with its thin-film technology that operates more efficiently in extreme environments that reduce the output from their silicon brethren, making it the preferred product for utility-scale projects. The company isn't resting on its laurels, with plans to bring its latest Series 6 panels to market by mid-2018. First Solar has earmarked over $500 million in spending to bring Series 6 to market -- after having already spent about the same amount in development. 

The company has a history of innovation, and the odds are good that it will be able to eke out even more efficiency from its technology, helping maintain its edge. But this isn't a risk-free proposition. Investors should acknowledge that Series 6 is still nearly a year from full-scale production, and as my colleague Travis Hoium wrote, "It's the biggest transition in the company's history." So while 2018 could be a choppy year as First Solar transitions to Series 6, it should help the company remain the leader in utility-scale solar. 

If First Solar's big bet on Series 6 pays off, the company will remain well-positioned for many more years of dominance in the solar industry, right when global growth is really taking off. 

 

Chuck Saletta has no position in any of the stocks mentioned. Jason Hall owns shares of First Solar. Reuben Gregg Brewer owns shares of Hormel Foods. The Motley Fool recommends First Solar. The Motley Fool has a disclosure policy.