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AI-Powered Data Center Stocks to Buy Now

The artificial intelligence (AI) saga, supported by the massive growth of cloud computing and data centers, is yet to unfold. The demand for data center capacity surged to manage and store the vast amount of cloud computing-based data.

The AI infrastructure space remains rock solid, supported by an extremely bullish demand scenario. According to a report by Bloomberg Intelligence, “the generative AI market is poised to explode, growing to $1.3 trillion over the next 10 years from a market size of just $40 billion in 2022.”

in order to reap the benefit of this enormous opportunity, we recommend investors buy, at this stage, three large AI-powered data center and cloud infrastructure developers and hold them for the long term.These companies are: Vertiv Holdings Co. (VRT), Arista Networks Inc. (ANET) and Astera Labs Inc. (ALAB). Each of our picks currently carries either a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Vertiv Holdings Co. (VRT)

Zacks Rank #1 Vertiv Holdings is a leading global provider of critical digital infrastructure and services for data centers, communication networks, and commercial and industrial environments. Its portfolio mainly consists of power, cooling, and IT infrastructure solutions and services, particularly AI-enabled infrastructure.

Vertiv is benefiting from an extensive product portfolio, which spans thermal systems, liquid cooling, UPS, switchgear, busbar and modular solutions. CEO Giordano Albertazzi said, “Our 35% sales growth and robust orders momentum reflect both strong market demand and expanded capabilities to serve customers’ increasingly complex infrastructure needs.”

Buoyed by unprecedented data center growth, VRT is strategically expanding capacity to accelerate its AI-enabled pipeline. Vertiv’s partnership with NVIDIA Corp. (NVDA) is a key catalyst. VRT aims to stay one GPU generation ahead of NVIDIA, enabling efficient, scalable power solutions for next-generation AI data centers.

Apart from NVIDIA,Vertiv has a rich partner base,which includes Ballard Power Systems Inc. (BLDP), Compass Datacenters, Intel Corp. (INTC), ZincFive, and Tecogen.

For 2025, the Zacks Consensus Estimate currently shows revenues of $9.97 billion, suggesting an betterment of 24.5% year over year, and earnings per share of $3.82, indicating an increase of 34% year over year. The Zacks Consensus Estimate for current-year earnings has improved 7.3% over the last 30 days.

for 2026, the Zacks Consensus Estimate currently shows revenues of $11.55 billion, suggesting an improvement of 15.8% year over year, and earnings per share of $4.85, indicating an increase of 26.9% year over year. The Zacks Consensus Estimate for current-year earnings has improved 10.5% over the last 30 days.Arista Networks inc. (ANET)

Arista Networks is a leading provider of cloud networking solutions,supported by software,designed for large-scale data center and campus environments.

The company’s innovative approach to software-defined networking,combined with its high-performance hardware,has positioned it as a key player in the rapidly evolving data center market. Arista’s solutions are known for their reliability, scalability, and programmability.

According to Zacks Investment Research, Arista has a strong track record of exceeding expectations. Its EOS operating system provides a robust platform for network automation and monitoring.

For the current fiscal year, analysts predict revenue growth of 19.7%. For the next fiscal year, revenue is expected to reach $6.53 billion, representing an impressive 17.1% growth rate.

Astera Labs Inc. (ALAB)

Astera Labs is a rapidly growing fabless semiconductor company focused on data center connectivity solutions. The company specializes in developing and delivering high-speed interconnects that enable efficient data transfer between CPUs, GPUs, and memory.

Astera Labs benefits from the increasing demand for high-bandwidth, low-latency connectivity in AI and machine learning applications. Its product portfolio includes PCIe switches, which are critical components in modern data centers.The company’s revenue is projected to soar. The Zacks Consensus Estimate for 2024 is $342.7 million, a dramatic increase from $157.8 million in 2023. For 2025,revenue is expected to jump to $542.8 million, and analysts anticipate $778.6 million in 2026.

By investing in these three companies-Vertiv, Arista, and Astera Labs-investors can position themselves to capitalize on the explosive growth of the AI-powered data center market.

What are the primary factors driving the current boom in AI infrastructure investment?

Investing in Leading AI-Focused Data Centre and Cloud Infrastructure Developers for Content Creation Opportunities

The explosion of Artificial Intelligence (AI) is fundamentally reshaping content creation.From automated scriptwriting to AI-powered video editing and image generation, the demand for computational power is skyrocketing. This presents a important investment possibility in the companies building the underlying infrastructure – specifically, leading data center and cloud infrastructure developers focused on AI workloads. This article explores key players, investment strategies, and the future landscape of this rapidly evolving market.

The AI Infrastructure boom: Why Now?

content creation is no longer solely a human endeavor. AI tools are becoming integral to workflows across various industries, including marketing, entertainment, education, and journalism. This shift necessitates robust and scalable infrastructure. Several factors are driving this boom:

Generative AI Growth: Models like GPT-4, DALL-E 3, and Stable Diffusion require massive computational resources for training and inference.

Edge AI Expansion: As highlighted by advancements in 5G, deploying AI capabilities closer to the data source (edge computing) reduces latency and bandwidth costs, particularly for real-time content processing. The ability to offload processing to the cloud via 5G networks is crucial.

Demand for Specialized Hardware: Customary CPUs are often insufficient for AI tasks. Investment is flowing into GPUs, TPUs, and other specialized AI accelerators.

Cloud migration: Content creators are increasingly adopting cloud-based solutions for scalability, cost-effectiveness, and accessibility.

Key Players in AI Data Center & Cloud Infrastructure

Identifying the right companies to invest in requires understanding the landscape.Here’s a breakdown of leading developers, categorized by their primary focus:

1. Hyperscale Cloud Providers:

Amazon Web Services (AWS): dominates the cloud market and offers a complete suite of AI/ML services (SageMaker,EC2 instances optimized for AI). Continues to invest heavily in custom AI chips (Trainium, Inferentia).

Microsoft Azure: Strong AI offerings integrated with its broader cloud platform. Partnerships with OpenAI give it a competitive edge in generative AI.

Google cloud Platform (GCP): Leverages Google’s expertise in AI and machine learning. Offers TPUs (Tensor Processing units) – specialized hardware for AI workloads.

Equinix: A global leader in data center colocation and interconnection. Benefits from the increased demand for data center space from AI companies.

Digital Realty: Another major data center REIT, focusing on providing infrastructure for cloud service providers and enterprises.

CyrusOne: Specializes in hyperscale data center solutions, catering to the needs of large AI and cloud customers.

3. Hardware Manufacturers:

NVIDIA: The undisputed leader in GPUs, essential for AI training and inference. Dominates the AI hardware market.

AMD: Increasingly competitive in the GPU space, offering alternatives to NVIDIA’s offerings.

Intel: Developing AI accelerators and investing in data center infrastructure.

Direct Stock Investment: Investing in the publicly traded stocks of the companies listed above. requires thorough research and risk assessment.

Exchange-Traded Funds (ETFs): ETFs focused on cloud computing, semiconductors, or AI can provide diversified exposure to the sector. Examples include:

Global X Cloud Computing ETF (CLOU)

iShares Semiconductor ETF (SOXX)

ROBO Global Robotics and Automation Index ETF (ROBO)

Venture Capital/Private Equity: Investing in early-stage companies developing innovative AI infrastructure technologies. Higher risk, but potentially higher returns.

REIT Investment: Investing in Data Center REITs provides exposure to the physical infrastructure supporting AI growth.

The Role of 5G in AI-Powered Content Creation

The synergy between 5G and AI is critical.5G’s low latency and high bandwidth enable:

* Real-time AI Processing: Faster data transfer allows for real-time AI-powered video editing, image enhancement, and content personalization.