In this article, we will look at the 10 Best Data Center Stocks with Huge Upside Potential.
Data center stocks are getting more attention as the AI buildout moves beyond the chip trade and into the wider infrastructure stack. The theme includes cloud infrastructure, servers, storage, optical networking, custom semiconductors, backup power, cooling, and the mechanical and electrical systems needed to keep data center facilities running.
Fidelity says the AI infrastructure trade includes “chips, but also memory, interconnects, networking, and advanced packaging,” while also pointing to companies with “mechanical and electrical systems” and “significant exposure to data centers and related infrastructure.” BlackRock frames the pressure point more directly, saying the AI buildout is revealing “capacity constraints in many key inputs,” with “power being one of the most strained.” The firm estimates “approximately 148 gigawatts (GW) of additional power capacity” will be needed by the end of the decade to satisfy data center demand. Janus Henderson adds that “Supply at nearly every layer of the stack, from memory to compute to power, still cannot keep pace with demand,” while “Optical connectivity and advanced cooling systems face further strain.”
Against this backdrop, data center stocks with huge upside potential deserve a closer look. With that in mind, let’s take a look at the 10 Best Data Center Stocks with Huge Upside Potential.
Our Methodology
We used the Finviz screener to identify data center stocks that offer notable upside from analysts’ price targets. We then limited our final selection to companies that have recently reported noteworthy developments likely to impact investor sentiment. These stocks are also popular among analysts and elite hedge funds.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).
10. Ciena Corporation (NYSE:CIEN)
On May 26, 2026, BofA analyst Tal Liani raised the firm’s price target on Ciena Corporation (NYSE:CIEN) to $660 from $550 and maintained a Buy rating on the shares. Liani said Cisco’s (CSCO) recent fiscal Q3 results and commentary around continued strong demand for Acacia keep BofA positive on the underlying demand environment for Optical Networking.
On May 18, 2026, Citi analyst Atif Malik raised the firm’s price target on Ciena Corporation to $658 from $345 and maintained a Buy rating on the shares ahead of the April quarter report on June 4. Malik said the company’s fiscal 2027 and 2028 growth expectations have “materially increased” due to stronger demand for optical connectivity. Citi cited Ciena’s higher sustainable sales growth and improved profitability for the target increase.
Similarly, TD Cowen analyst Sean O’Loughlin raised the firm’s price target on Ciena Corporation to $675 from $425 and maintained a Buy rating on the shares. O’Loughlin said AI capex continues to move higher as investors look for the next infrastructure “bottleneck.” TD Cowen said this has driven a “bifurcation within the infrastructure trade,” with optical names trading higher on expectations of future shortages. The firm now sees $1.3 trillion in data center silicon spending by 2030, up from $1.2 trillion previously.
Ciena Corporation provides hardware, software, and services for network operators across the Americas, Europe, the Middle East, Africa, the Asia Pacific, Japan, and India.
9. Western Digital Corporation (NASDAQ:WDC)
On May 27, 2026, Barclays analyst Tom O’Malley raised the firm’s price target on Western Digital Corporation (NASDAQ:WDC) to $620 from $450 and maintained an Overweight rating on the shares. O’Malley said memory and storage remain the “most attractive vertical below accelerators” in the semiconductor group. Barclays expects continued pricing upside as the supply-demand imbalance persists through 2027, with the biggest hard disk drive pricing opportunity expected toward the end of the year as new contract pricing and products come into play and mix shifts toward 40TB drives.
Evercore ISI analyst Amit Daryanani also raised the firm’s price target on Western Digital Corporation to $575 from $500 and maintained an Outperform rating on the shares after hosting investor meetings. Daryanani said Western Digital and the hard disk drive industry remain a “critical and still underappreciated component” of the AI infrastructure buildout, while adding that the company’s revenue growth can outpace exabyte growth.
On May 18, 2026, Western Digital Corporation announced the integration of post-quantum cryptography into its newest high-capacity Ultrastar UltraSMR hard disk drives. The company said the move addresses next-generation infrastructure security as AI systems increasingly retain data across inference, training, and interactions. The drives are currently in qualification with multiple hyperscale customers, reflecting early interest in quantum-resilient storage architectures.
Western Digital Corporation develops, manufactures, and sells data storage devices and solutions based on hard disk drive technology across the United States, Asia, Europe, the Middle East, and Africa.
8. Marvell Technology, Inc. (NASDAQ:MRVL)
On May 28, 2026, Deutsche Bank raised the firm’s price target on Marvell Technology, Inc. (NASDAQ:MRVL) to $240 from $120 and maintained a Buy rating on the shares. Deutsche Bank said the company’s fiscal Q1 report and Q2 outlook were solid, with data center revenue “led the way in both quarters.”
Barclays analyst Tom O’Malley also raised the firm’s price target on Marvell Technology, Inc. to $275 from $150 and maintained an Overweight rating on the shares following the company’s earnings report.
Similarly, Jefferies analyst Blayne Curtis raised the firm’s price target on Marvell to $235 from $149 and maintained a Buy rating after a “modest” beat and raise, with optical demand driving near-term upside. Curtis added that the “larger upside” was increased confidence in FY28, supported by near-term optical tailwinds and growing XPU attach.
On May 27, 2026, Marvell Technology, Inc. reported Q1 adjusted EPS of 80c, ahead of the consensus estimate of 79c. Revenue totaled $2.418B, above the consensus estimate of $2.41B. Chairman and CEO Matt Murphy said Marvell delivered record first-quarter fiscal 2027 revenue, up 28% year-over-year, and guided second-quarter revenue to $2.7 billion at the midpoint. Murphy said revenue growth is expected to accelerate through fiscal 2027, driven by continued strength in the data center business and “exceptional AI-related bookings.”
Marvell Technology, Inc. provides data infrastructure semiconductor solutions from the data center core to the network edge internationally.
7. Cummins Inc. (NYSE:CMI)
On May 26, 2026, Raymond James raised the firm’s price target on Cummins Inc. (NYSE:CMI) to $745 from $675 and maintained an Outperform rating on the shares. Raymond James cited stronger long-term growth assumptions, saying the prior $45B-$50B 2030 revenue outlook appears conservative given a weaker starting base, implying greater upside potential than previously reflected in expectations.
Cummins Inc.’s leadership team shared plans with analysts and shareholders to raise the company’s long-term financial expectations for growth and profitability relative to its prior Analyst Day. Chair and CEO Jennifer Rumsey said Cummins has navigated complexity while continuing to execute with discipline, adding that the company is raising its 2030 financial targets. CFO Mark Smith said Cummins is raising expectations for revenue growth and margin expansion, supported by opportunities across businesses and regions.
Earlier in the month, Cummins Inc. reported Q1 EPS of $4.71, versus the consensus estimate of $5.55. Revenue totaled $8.4B, above the consensus estimate of $8.37B. The quarter included charges related to the sale of its low-pressure fuel cell business of $199 million, or $1.44 per diluted share. Rumsey said Cummins delivered “strong results” in the first quarter, led by record performance in Power Systems, and cited strong demand for data center backup power and improving North America truck markets.
Cummins Inc. offers power solutions worldwide through its Engine, Distribution, Components, Power Systems, and Accelera segments.
6. Dell Technologies Inc. (NYSE:DELL)
On May 22, 2026, Wells Fargo analyst Aaron Rakers raised the firm’s price target on Dell Technologies Inc. (NYSE:DELL) to $270 from $180 and maintained an Overweight rating on the shares. Rakers said the key driver is the pull-forward of Dell’s implied $17-$18 per share EPS into 2028 following the stock’s 101% year-to-date move. Wells Fargo now estimates 2028 EPS at $17.67 per share.
Morgan Stanley analyst Erik Woodring also raised the firm’s price target on Dell Technologies Inc. to $170 from $110 and maintained an Underweight rating on the shares. Woodring said Dell’s near-term results are likely to be “very strong,” with a fiscal Q1 beat and raise expected from traditional servers, PCs, enterprise pull-forward, and accelerating AI server momentum. Woodring added that Dell now trades at an all-time premium to AI infrastructure peers, while second-half uncertainty remains.
On May 18, 2026, Dell Technologies Inc. introduced Dell Deskside Agentic AI, a new addition to the Dell AI Factory with NVIDIA (NVDA). Dell said the product gives workgroups the ability to deploy and scale agentic AI workflows locally without the cost, latency, and data sovereignty constraints of cloud-only approaches. The company also said the NVIDIA OpenShell runtime is now supported across the entire Dell AI Factory with NVIDIA.
Dell Technologies Inc. designs, develops, manufactures, markets, sells, and supports integrated technology solutions, products, and services internationally.
5. Hewlett Packard Enterprise Company (NYSE:HPE)
On May 21, 2026, Morgan Stanley analyst Erik Woodring raised the firm’s price target on Hewlett Packard Enterprise Company (NYSE:HPE) to $33 from $25 and maintained an Equal Weight rating on the shares. Woodring said IT hardware has outperformed over the past two and a half months due to short covering, resilient near-term spending, and demand pull-forward. Morgan Stanley said its April and July quarter forecasts reflect stronger-than-expected spending, but warned that pull-forward, memory inflation, supply shortages, and macro pressure could create margin and earnings risk in the second half.
On May 15, 2026, JPMorgan raised the firm’s price target on Hewlett Packard Enterprise Company to $37 from $27 and maintained an Overweight rating on the shares. JPMorgan cited the reversal of memory-related concerns for the recent rally in the IT hardware group. The firm said it is most positive on Dell Technologies and HPE heading into earnings, and expects estimate increases to reinforce the companies’ medium-term earnings growth outlooks.
Earlier in May, Hewlett Packard Enterprise Company announced new self-driving network capabilities, calling itself the first provider of fully autonomous, agentic AIOps networking. The company said new self-driving actions across HPE Mist and HPE Aruba Central enable networks to detect, diagnose, and resolve issues in real time without human intervention. HPE said the architecture is powered by microservices, autonomous agents, and an advanced agentic mesh.
Hewlett Packard Enterprise Company develops intelligent technology solutions across the United States, the Americas, Europe, the Middle East, Africa, the Asia Pacific, Japan, and international markets.
4. Seagate Technology Holdings plc (NASDAQ:STX)
On May 27, 2026, Barclays analyst Tom O’Malley raised the firm’s price target on Seagate Technology Holdings plc (NASDAQ:STX) to $1,000 from $750 and maintained an Overweight rating on the shares. O’Malley said memory and storage remain the “most attractive vertical below accelerators” in the semiconductor group. Barclays expects continued pricing upside as the supply-demand imbalance persists through 2027, with the biggest hard disk drive pricing opportunity expected toward the end of the year as new contract pricing and products come into play and mix shifts toward 40TB drives.
Also on May 27, Seagate Technology Holdings plc (NASDAQ:STX) and Seagate HDD Cayman announced the closing of previously announced privately negotiated exchanges of $185.908M principal amount of Seagate HDD’s 3.50% Exchangeable Senior Notes due 2028. The exchange consideration included $185.908M in cash and approximately 2.02M ordinary shares of Seagate stock. The exchanged notes have been retired, while approximately $185.8M in aggregate principal amount of notes remain outstanding with unchanged terms.
A day earlier, BofA raised the firm’s price target on Seagate Technology Holdings plc (NASDAQ:STX) to $900 from $840 and maintained a Buy rating on the shares. After hosting a client call with CEO Dave Mosley, BofA used a higher multiple, citing more confidence in the sustainability of demand and pricing.
Seagate Technology Holdings plc (NASDAQ:STX) provides data storage technology and infrastructure solutions in Singapore, the United States, the Netherlands, and internationally.
3. EMCOR Group, Inc. (NYSE:EME)
On May 28, 2026, Oppenheimer analyst Brent Thielman initiated coverage of EMCOR Group, Inc. (NYSE:EME) with an Outperform rating and a $1,100 price target. Thielman viewed EMCOR as one of the “higher quality” public infrastructure services companies, citing its exposure to the reacceleration of high-tech manufacturing projects and data center development. Oppenheimer also sees EMCOR as a long-term compounder with acquisition optionality.
Baird also raised the firm’s price target on EMCOR Group, Inc. to $900 from $808 and maintained an Outperform rating on the shares. Baird updated its model following Q1 results and said guidance still looks fairly conservative.
Last month, EMCOR Group, Inc. reported Q1 EPS of $6.84, ahead of the consensus estimate of $5.90. Revenue totaled $4.63B, above the consensus estimate of $4.2B. Chairman, President, and CEO Tony Guzzi said EMCOR started the year well, with record quarterly revenue and strong operating performance across key market sectors and geographies. Guzzi also said Remaining Performance Obligations reached record levels again, supported by the quality and diversity of bookings during the quarter.
EMCOR Group, Inc. provides electrical and mechanical construction, facilities, building, and industrial services in the United States and the United Kingdom.
2. Comfort Systems USA, Inc. (NYSE:FIX)
On May 28, 2026, Oppenheimer initiated coverage of Comfort Systems USA, Inc. (NYSE:FIX) with an Outperform rating and a $2,200 price target. Oppenheimer said the company is “uniquely positioned” to address demand for complex facilities and believes Comfort Systems USA has a high potential to sustain or exceed its recent earnings growth rates.
UBS also raised the firm’s price target on Comfort Systems USA, Inc. to $1,992 from $1,680 and maintained a Buy rating on the shares. UBS said Comfort Systems USA posted another strong quarter.
Last month, Comfort Systems USA, Inc. reported Q1 EPS of $10.51, ahead of the consensus estimate of $6.81. Revenue totaled $2.87B, above the consensus estimate of $2.39B. CEO Brian Lane said the company delivered “unprecedented results,” including 51% organic revenue growth compared to the same quarter last year, per-share earnings that more than doubled, and more than $375 million of quarterly cash flow.
Comfort Systems USA, Inc. provides mechanical and electrical installation, renovation, maintenance, repair, and replacement services in the United States.
1. Amazon.com, Inc. (NASDAQ:AMZN)
On May 27, 2026, Amazon.com, Inc. (NASDAQ:AMZN) shared a leadership update saying Neil Lindsay will step back from his Amazon role after more than 15 years at the company and five years helping establish its healthcare business. Amazon said Dr. Roy Schoenberg will become the new leader of Amazon Health Services, effective July 1. Schoenberg was described as a physician, entrepreneur, and digital healthcare pioneer who co-founded and led Amwell. Lindsay will help transition responsibilities over the summer and remain available in an advisory role through the end of 2026.
Amazon.com, Inc. also said in a post to its AWS blog that Anthropic’s Claude Opus 4.8 is now available on Amazon Bedrock and the Claude Platform on AWS. Amazon said Claude Opus 4.8 brings improvements across production workflows, including agentic coding, deep knowledge work, and multi-stage autonomous tasks. The company added that Claude Opus 4.8 on Amazon Bedrock lets customers build within their existing AWS environment while maintaining enterprise security and regional data residency.
On May 20, 2026, Wells Fargo lowered the firm’s price target on Amazon.com, Inc. to $312 from $313 and maintained an Overweight rating on the shares. Wells Fargo said market confidence is improving in companies that monetize compute investments directly through cloud businesses, supported by accelerating cloud revenue, stable-to-improving margins, and rising backlogs.
Amazon.com, Inc. engages in the retail sale of consumer products, advertising, and subscription services through online and physical stores in North America and internationally.
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