{"id":12308,"date":"2023-11-10T19:09:51","date_gmt":"2023-11-10T19:09:51","guid":{"rendered":"https:\/\/infundpros.com\/markets\/2-stocks-that-could-benefit-from-generative-ais-energy-demand-growth\/"},"modified":"2023-11-10T19:09:52","modified_gmt":"2023-11-10T19:09:52","slug":"2-stocks-that-could-benefit-from-generative-ais-energy-demand-growth","status":"publish","type":"post","link":"https:\/\/infundpros.com\/?p=12308","title":{"rendered":"2 Stocks That Could Benefit From Generative AI\u2019s Energy Demand Growth"},"content":{"rendered":"
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Generative AI is driving a surge in energy demand.<\/p>\n

Investors may be able to profit from Generative AI\u2019s hunger for computing power by investing in data centers and\/or publicly-traded providers of technology for cooling those data centers.<\/p>\n

How Investors Can Profit From Generative AI\u2019s Computing Demand Growth<\/h2>\n

Investing in the leaders in each industry could be rewarding.<\/p>\n

Publicly traded data centers include Equinix\ufeff, Digital Realty, and Akamai. Publicly-traded providers of immersive cooling systems are Vertiv, Schneider Electric, and Lenovo, Forrester Research
\n FORR
\n <\/fbs-ticker>
\n FORR
\n <\/fbs-ticker> senior analyst Abhijit Sunil told me in an October 20 interview.<\/p>\n

Of these, Equinix and Vertiv appear to have the most upside investment potential due to their expectations-beating growth, market leadership, and significant investments to satisfy growing demand.<\/p>\n

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One analyst sees data center operators as winners. \u201cThe actual data usage and how all this comes together is going to be more concentrated to a couple of companies out there,” Angelo Zino Vice President, Senior Industry Analyst at CFRA Research, told Yahoo! Finance<\/em>.<\/p>\n

\u201cMore and more companies are essentially renting space in the cloud rather than kind of investing and building their own data centers, just because in the future I think it’s going to be a lot more costly in nature,\u201d he added.<\/p>\n

While growth in demand for data centers may be more self-evident, the demand for so-called liquid cooling is less obvious.<\/p>\n

Due to the amount of heat generated by densely packed servers doing calculations all day long boosts the amount of heat that must be eliminated to keep the equipment from overheating.<\/p>\n

Liquid cooling \u2014 which circulates water or other coolants through heat exchangers to absorb the heat generated by computer components \u2014 is more efficient than fans or air conditioning, KPMG managing director Brian Lewis told Network World<\/em>.<\/p>\n

Liquid cooling has practical implications for data center operators. “Liquid cooling adds weight because it is sitting on the floor and is embedded into the circuit boards. It is heavier than air cooled which has big fans blowing in the data center,\u201d Sunil told me.<\/p>\n

As I noted earlier, Equinix
\n EQIX
\n <\/fbs-ticker> and Vertiv strike me as interesting investment opportunities in the datacenter and liquid cooling markets, respectively.<\/p>\n

Equinix\u2019s Performance And Prospects<\/h2>\n

Equinix \u2014 a Redwood City, Calif.-based operator of 248 data centers in 31 countries \u2014 is a leader in the \u201cglobal colocation data center market,\u201d according to the company.<\/p>\n

Its recent performance and prospects appear compelling. In its third quarter \u2014 ending September 2023, Equinix reported strong growth \u2014 driven by \u201cintegration of AI into enterprise business strategies\u201d along with profit increases and winning new customers.<\/p>\n

Here are the key numbers from GuruFocus:<\/p>\n