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AI Data Center Buildout

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The AI Data Center Buildout is driven by increasing demand for GPUs, necessitating advancements in power, cooling, connectivity, and construction, with second-order effects creating opportunities for mispriced investments.

Current Priced Wave

3

Next Alpha Wave

4

Time Horizon

quarters

Wave 3 companies are gaining recognition as critical enablers of AI data centers, but Wave 4 offers untapped potential in construction and real estate.

Wave 1: GPU Demand Surge

Awareness: fully_priced | Alpha: minimal

Companies directly benefiting from increased demand for GPUs in AI data centers.

NVDA - NVIDIA Corporation

GPU Manufacturer

Primary supplier of GPUs for AI workloads.

Mispricing angle: Market is aware of NVIDIA's dominance, but may underestimate the sustained demand growth from AI applications.

Mispricing: -

Analysts: -

90d vs 200d: -

AMD - Advanced Micro Devices, Inc.

GPU Manufacturer

Competes with NVIDIA in supplying GPUs for AI.

Mispricing angle: Market sees AMD as a secondary player, but its competitive pricing and innovation could capture more market share.

Mispricing: -

Analysts: -

90d vs 200d: -

INTC - Intel Corporation

Chip Manufacturer

Expanding into AI-focused GPUs and accelerators.

Mispricing angle: Market doubts Intel's ability to compete in GPUs, but its R&D investments could yield breakthroughs.

Mispricing: -

Analysts: -

90d vs 200d: -

Wave 2: Power and Cooling Infrastructure

Awareness: partially_known | Alpha: moderate

Companies providing essential power and cooling solutions for data centers.

APC - American Power Conversion

Power Solutions Provider

Supplies uninterruptible power supplies (UPS) and power management systems.

Mispricing angle: Market underestimates the scale of power infrastructure upgrades needed for AI data centers.

Mispricing: -

Analysts: -

90d vs 200d: -

CARR - Carrier Global Corporation

Cooling Solutions Provider

Provides HVAC and cooling systems for data centers.

Mispricing angle: Market views Carrier as a traditional HVAC company, overlooking its data center cooling segment growth.

Mispricing: -

Analysts: -

90d vs 200d: -

EMR - Emerson Electric Co.

Cooling and Power Solutions

Offers integrated solutions for data center power and cooling.

Mispricing angle: Market sees Emerson as an industrial player, not fully appreciating its data center focus.

Mispricing: -

Analysts: -

90d vs 200d: -

Wave 3: Connectivity and Networking

Awareness: emerging | Alpha: significant

Companies enhancing data center connectivity and networking capabilities.

CSCO - Cisco Systems, Inc.

Networking Equipment Provider

Supplies networking hardware and software for data centers.

Mispricing angle: Market sees Cisco as a legacy player, underestimating its role in next-gen data center networks.

Mispricing: -

Analysts: -

90d vs 200d: -

ANET - Arista Networks, Inc.

Cloud Networking Solutions

Focuses on high-performance cloud networking solutions.

Mispricing angle: Market acknowledges Arista's growth, but may not fully price in its AI-driven demand potential.

Mispricing: -

Analysts: -

90d vs 200d: -

JNPR - Juniper Networks, Inc.

Networking Solutions Provider

Provides networking solutions tailored for AI data centers.

Mispricing angle: Market underestimates Juniper's strategic partnerships and AI-focused product lines.

Mispricing: -

Analysts: -

90d vs 200d: -

Wave 4: Construction and Real Estate

Awareness: undiscovered | Alpha: high

Companies involved in the construction and real estate aspects of data center buildouts.

PLD - Prologis, Inc.

Industrial Real Estate

Invests in and develops data center properties.

Mispricing angle: Market views Prologis as a logistics REIT, not fully pricing in its data center expansion.

Mispricing: -

Analysts: -

90d vs 200d: -

JLL - Jones Lang LaSalle Incorporated

Real Estate Services

Provides real estate services for data center construction.

Mispricing angle: Market underestimates JLL's expertise and growth in the data center sector.

Mispricing: -

Analysts: -

90d vs 200d: -

CBRE - CBRE Group, Inc.

Real Estate Services

Offers comprehensive real estate solutions for data centers.

Mispricing angle: Market sees CBRE as a general real estate services firm, overlooking its data center specialization.

Mispricing: -

Analysts: -

90d vs 200d: -

Wave 5: Second-Order Effects

Awareness: contrarian | Alpha: high

Companies benefiting indirectly from the AI data center buildout.

VZ - Verizon Communications Inc.

Telecommunications Provider

Provides connectivity solutions that support data center operations.

Mispricing angle: Market focuses on Verizon's consumer business, underestimating its data center connectivity role.

Mispricing: -

Analysts: -

90d vs 200d: -

SRE - Sempra Energy

Energy Provider

Supplies energy solutions tailored for data center needs.

Mispricing angle: Market sees Sempra as a traditional utility, not recognizing its strategic data center energy partnerships.

Mispricing: -

Analysts: -

90d vs 200d: -

STLD - Steel Dynamics, Inc.

Steel Supplier

Provides steel for data center construction.

Mispricing angle: Market views Steel Dynamics as a commodity player, overlooking its data center construction demand.

Mispricing: -

Analysts: -

90d vs 200d: -

Monitoring Triggers

Increased AI data center announcements
Technological advancements in cooling and power efficiency
Regulatory changes affecting data center construction

Invalidation Triggers

Significant slowdown in AI adoption
Major technological disruption reducing data center needs
Economic downturn impacting capital expenditure on infrastructure