In this article, we will take a look at the top 10 data center cooling companies to invest in.
The unprecedented data center demand driven by massive investments in AI infrastructure is well-documented. According to several research reports, the total data center infrastructure market could reach $1 trillion by 2030. Companies are already trying their best to meet this surging demand.
One example of this was visible during the discussion when Jacobs Solutions CEO Robert Pragada appeared on CNBC on November 24, 2025. He not only confirmed that demand was through the roof but also explained how the industry is operating at capacity, with future growth likely propelled by quantum and life sciences. Regarding future growth, he explained that the quantum buildout could be even larger than the AI infrastructure buildout.
“It’s the synthesis of even more complex energy usage around the next form of computing. So, think AI data centers, and then if there’s a next phase of that, it would be in quantum.”
This complex energy usage will require even better cooling than existing data centers have, keeping demand for cooling solutions high. However, Pragada did point out that investments in quantum technologies were limited to R&D at the moment, but will take over from AI when practical solutions start to emerge.
“There’s a bit of development that still needs to happen before you get to full quantum computing”.
It is clear that data center demand isn’t just a result of increasing AI usage. It is likely to continue well into the future as the next generation of technologies, especially quantum, takes over from AI at some stage.
In other news, Supermicro announced on December 9 that it expanded its Nvidia Blackwell portfolio by launching 4U and 2-OU liquid cooling systems, which capture 98% of system heat through direct-liquid-cooling technology. Developments like these prompt investors to seek out the top data center cooling companies to invest in, where our list can help.
Our Methodology
To identify our top 10 data center cooling companies to invest in, we first searched online for companies that specialize in, or are investing in, data center cooling solutions. We then reviewed data center ETFs for companies that also manufacture their own cooling solutions. We then selected the top 10 stocks with the highest upside potential based on CNN data and ranked them accordingly. Additionally, we also included data on hedge fund holdings in these companies as of Q3 2025 to provide further insight into investor interest.
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 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
Top 10 Data Center Cooling Companies to Invest In
10. Vertiv Holdings Co. (NYSE:VRT)
Potential Upside: 7.75%
Number of Hedge Fund Holders: 61
Citigroup issued a significant update on Vertiv Holdings Co. (NYSE:VRT) on December 8. While increasing the price target from $198 to $220, the financial services firm maintained its Buy rating on the stock. This rating was issued by the analyst Andrew Kaplowitz. The newly assigned target price represents an 11.11% upside from current levels. The upward adjustment to the target price indicates that Citigroup still sees potential in Vertiv Holdings Co. (NYSE:VRT).
Vertiv Holdings Co. (NYSE:VRT) completed its acquisition of PurgeRite on December 4th for approximately $1 billion. This acquisition aims to improve the company’s thermal management services capabilities, mainly for AI and high-density computing data centers. The integration is intended to enhance the equipment efficiency and heat transfer and reduce the downtime.
The deal positions Vertiv Holdings Co. (NYSE:VRT) well to capture the emerging market opportunities. Analysts project this year’s revenue at around 28%, similar to the previous year’s 28.76% growth.
Gio Albertazzi, CEO at Vertiv, explained how this acquisition is beneficial for the company:
“PurgeRite’s specialized expertise in fluid management services complements our existing portfolio and enhances our ability to provide end-to-end product and service support for customers’ high-density computing and AI applications.”
Vertiv Holdings Co. (NYSE:VRT) operates as a manufacturer, designer, and servicer of the critical digital infrastructure technology for the communication networks, data centers, and commercial and industrial environments. It provides thermal management products, AC and DC power management products, modular solutions, switchgear and busbar products, management systems, and integrated rack systems.
9. SPX Technologies, Inc. (NYSE:SPXC)
Potential Upside: 9.14%
Number of Hedge Fund Holders: 37
On December 8, the company announced that it had entered into a definitive agreement to acquire Crawford United Corporation (OTC:CRAWA), a Cleveland-based holding company. The deal is valued at approximately $300 million. This acquisition is part of SPX Technologies’ expansion plans. As per the agreement, Crawford United will be merged with a subsidiary of SPX. With this acquisition, SPXC will expand its HVAC capabilities by incorporating the Commercial Air-Handling Equipment segment of Crawford United. This segment contains Rahn Industries and Air Enterprises.
Over the past 12 months ending September 30, 2025, this segment reported $22.8 million in operating profit and $81.6 million in sales. SPX Technologies also reported total revenue of $2.16 billion over the last 12 months, with solid revenue growth of 12.6%.
After the deal closes, SPXC will merge Crawford United’s Commercial Air-Handling Equipment segment with its HVAC segment. Meanwhile, the company intends to divest the Industrial & Transportation Products segment of Crawford United. The reason for its divestiture is that this segment does not align with the firm’s long-term strategy.
Gene Lowe, SPX Technologies President & CEO, highlighted the potential of this acquisition by mentioning:
“Their commercial air-handling business is an excellent fit for our HVAC platform, strengthening our ability to deliver end-to-end solutions to customers in healthcare, universities, pharmaceutical, advanced manufacturing, and commercial markets.”
SPX Technologies, Inc. operates as a supplier of infrastructure equipment to global markets. It mainly serves the cooling (HVAC), heating, ventilation, and detection & measurement markets. The company operates through HVAC and Detection and Measurement segments. It sells its products through retailers, third-party distributors, and independent manufacturing representatives.
8. Comfort Systems USA, Inc. (NYSE:FIX)
Potential Upside: 15.21%
Number of Hedge Fund Holders: 67
On December 5, Comfort Systems (NYSE:FIX) was selected to become a part of the S&P 500 index. The news came after the quarterly rebalancing of the index, meaning FIX will now be included in the S&P 500 index before the market opens on December 22. The company is one of three tickers that will replace LKQ Corp. (NASDAQ:LKQ), Mohawk Industries Inc.(NYSE:MHK), and Solstice Advanced Materials Inc. (NASDAQ:SOLS).
According to a December 6 Bloomberg report, Matt Maley, chief market strategist at Miller Tabak + Co., mentioned how the stock price tends to rise leading up to the inclusion. This was witnessed in the case of Comfort Systems stock as well. However, he was also quick to point out that this increasing interest in the stock quickly subsides once the inclusion actually happens. For now, the positive momentum since the April dip is likely to continue.
The optimism isn’t just coming on the back of the S&P inclusion. After posting an earnings beat in the third quarter on October 24, FIX received two back-to-back upgrades from UBS and Stifel. As things stand, the stock enjoys a consensus buy rating with a median price target offering 15.21% upside from current levels.
Comfort Systems USA, Inc. provides mechanical and electrical installation, maintenance, replacement, renovation, and repair services. The firm operates through Electrical and Mechanical segments. It provides ventilation, air conditioning, and heating systems. It was founded in 1917 and is based in Houston, Texas.
7. Trane Technologies Plc (NYSE:TT)
Potential Upside: 18.31%
Number of Hedge Fund Holders: 58
On December 4, Trane Technologies Plc’s (NYSE:TT) price target was raised by $11 to $506 by Barclays. The firm maintained the previous Overweight rating on the stock. This nudges Barclays’ price target closer to the $550 mark, which is the highest rating among 26 analysts the stock is covered by on Wall Street. It is well above the $470 median target price, which offers an 18.31% upside from here.
The price target boost follows a development on December 2 when the company acquired Stellar Energy Digital, a data center cooling solutions provider. The move will help the company further advance its thermal management ambitions in the growing data center market.
The company did not disclose the financial details of the acquisition. However, it can be confirmed that the deal involves the company’s Florida-based operations, which are currently managed by 700 employees, comprising two assembly facilities in Jacksonville. After the acquisition, the operations will continue under the same brand but will become a part of TT’s Commercial HVAC business unit. The transaction is expected to be executed in the first quarter of 2026.
These developments will boost the company’s near-term prospects, which are well complemented by its services business, which accounts for one-third of revenue. On December 2, Bank of America had already assigned a $550 price target to the stock, upgrading its rating to Buy from Neutral.
Trane Technologies plc (NYSE:TT) is a manufacturer, seller, designer, and servicer of solutions for air conditioning, ventilation, heating, and custom and transport refrigeration. The company provides airside and terminal devices, dehumidifiers, energy recovery ventilators, air-sourced heat pumps, coils and condensers, energy and water efficiency programs, and other products. It is headquartered in Swords, Ireland.
6. Modine Manufacturing Co. (NYSE:MOD)
Potential Upside: 20.22%
Number of Hedge Fund Holders: 49
An analyst at the financial services firm D.A. Davidson has issued an important update on the company. On December 9, analyst Matt Summerville reaffirmed his Buy rating on the stock and set a $200 target price. The new target price offers 30.76% upside from the current levels.
As of December 10, the stock is covered by nine analysts on Wall Street. Modine Manufacturing Company (NYSE:MOD) holds a Buy rating from all analysts covering it, reflecting their positive sentiment toward the stock. According to analysts’ estimates, the company has a median price target of $185, representing 20.95% upside from current levels. Moreover, the stock is currently trading below its lowest Wall Street price target, which implies 13.11% upside from that level.
UBS also took a bullish stance on Modine Manufacturing Company (NYSE:MOD), initiating coverage on November 20. The research firm assigned a Buy rating to the stock and set a $173 price target. UBS highlighted the company’s strong position in cooling systems for colocation, hyperscale, and neocloud customers worldwide. The firm expects Modine Manufacturing Company (NYSE:MOD) to deliver approximately 15% average annual revenue growth by FY2029, given its 30% exposure to the potential data center markets.
Modine Manufacturing Company (NYSE:MOD) operates as a tester, designer, manufacturer, engineer, and seller of mission-critical thermal solutions. The company operates through two segments: Performance Technologies and Climate Solutions. It provides heat-transfer, powertrain-cooling, and data-center products. The firm is headquartered in Racine, Wisconsin.
5. nVent Electric plc (NYSE:NVT)
Potential Upside: 21.37%
Number of Hedge Fund Holders: 58
On December 4, Barclays raised its price target on the stock from $130 to $140. It maintained the overweight rating on the stock it had previously assigned. The rating came after NVT presented at the 2025 Goldman Sachs Industrials and Materials Conference, where management expressed optimism about the company’s prospects.
To begin with, management emphasized how the new modular cooling and power portfolio was expected to meet the surging AI demand. The latest liquid cooling solutions were presented at the SC25 on November 17. On the occasion, GM of nVent Data Solutions, Eric Osborn, had said:
“We are tapping into our deep technical expertise and working collaboratively with chip manufacturers and the broader ecosystem to solve our customers’ unique challenges with these new liquid cooling and power solutions. Our commitment to leading innovation for next-generation AI chips is at the core of the work we have done in space for more than a decade.”
At the Goldman Sachs Conference, management talked about how the company was pivoting toward becoming a data center infrastructure company, as that is where the major growth is going to come from. NVT’s core business is providing electrical connection and protection solutions for a variety of industries, but its liquid cooling solutions are set to dominate the business.
On the financial front, management reiterated its confidence in strong, improving margins in the core business segment and that it won’t be hit by the focus on AI and data centers.
nVent Electric plc (NYSE:NVT) serves mission-critical processes across industries, leveraging its expertise to help companies ensure a safe, sustainable workplace. It is headquartered in London, United Kingdom, and has over 11,000 employees worldwide.
4. Eaton Corp. Plc (NYSE:ETN)
Potential Upside: 22.09%
Number of Hedge Fund Holders: 72
On December 9, Wolfe Research upgraded the company’s stock from Peer Perform to Outperform. The firm also assigned a target price of $413.
Analysts at Wolfe Research believe the company’s cyclical business units may have bottomed, pointing to both the Vehicle segment and eMobility. They believe the downturn has brought the company’s valuation to very reasonable levels.
Eaton Corporation plc’s (NYSE:ETN) forward earnings expectations are also reasonable, according to the research house, which believes the Boyd transaction could support the company’s growth and multiple expansion going forward.
As a reminder, on November 3, Eaton signed a deal to acquire Boyd Corporation’s thermal business unit for $9.5 billion. This investment was made to help the company improve its data center and liquid cooling capabilities to support the AI infrastructure being built. Eaton paid 22.5 times Boyd Thermal’s 2026 EBITDA. The CEO Paulo Ruiz had this to say at the time of the signing:
“Bringing together Boyd Thermal’s highly-engineered liquid cooling technology and global service model with Eaton’s existing products and scale will provide enhanced value to customers. In data centers, particularly, our combined expertise in both power and liquid cooling from the chip to the grid will enable customers to manage increasing power demands more effectively.”
Eaton Corporation plc (NYSE:ETN) is a power management company operating in the United States, Latin America, Canada, Asia Pacific, and Europe. The company functions across five segments: Electrical Global, Aerospace, eMobility, Vehicle, and Electrical Americas. It provides power distribution and assemblies, emergency lighting, single- and three-phase power-quality and connectivity products, electrical components, wiring devices, and more. It is based in Dublin, Ireland.
3. Regal Rexnord Corp. (NYSE:RRX)
Potential Upside: 23.2%
Number of Hedge Fund Holders: 39
On December 2, Julian Mitchell, an analyst at Barclays, reaffirmed his Buy rating on the stock. He assigned a price target of $165 to the company. The new target price offers 10.85% upside from the current price levels.
On November 21, Regal Rexnord Corporation signed an agreement replacing its previous credit facility. The firm announced on November 25 that it has entered into a Third Amended and Restated Credit Agreement as an administrative agent. This agreement was signed with a banking group led by JPMorgan Chase Bank, N.A. Under the agreement, RRX obtained an unsecured delayed-draw term loan of $850 million, with a maturity date of February 21, 2029. Additionally, the company also secured an unsecured revolving credit line in U.S. dollars and other currencies, of up to $1.5 billion, maturing on November 21, 2030.
Regal Rexnord Corporation’s (NYSE:RRX) strong current ratio of 2.05 supports this financing facility, as it demonstrates the company can readily meet its short-term obligations with liquid assets. The company intends to use these new credit facilities to pay associated expenses and fees, refinance its existing credit agreement, fund general corporate purposes, and finance capital expenditures and working capital.
Regal Rexnord Corporation (NYSE:RRX) provides sustainable solutions. The company offers motor, power transmission, and air handling solutions. It operates in three segments: Power Efficiency Solutions, Industrial Powertrain Solutions, and Automation and Motion Control.
2. Super Micro Computer Inc. (NASDAQ:SMCI)
Potential Upside: 31.47%
Number of Hedge Fund Holders: 42
On December 9, the company expanded its NVIDIA Blackwell Portfolio by introducing new 4U and 2-OU (OCP) liquid-cooled NVIDIA HGX B300 systems. These products are designed to deliver power efficiency and exceptional GPU density for the AI factory deployments and hyperscale data centers.
Super Micro Computer Inc. developed these platforms to target customer needs for higher efficiency, lower cost, and serviceability. Data centers can save up to 40% on power by leveraging DLC-2 technology stack. Moreover, data centers can also reduce their water usage with warm 45°C water operation. It would help them remove the need for the compressors and chilled water in data centers. These new systems are provided as fully tested, ready-to-use L11 and L12 racks, enabling enterprise, federal, and hyperscaler customers to deploy their data centers faster.
Charles Liang, president and CEO of Supermicro, highlighted this development by saying:
“With AI infrastructure demand accelerating globally, our new liquid-cooled NVIDIA HGX B300 systems deliver the performance density and energy efficiency that hyperscalers and AI factories need today, We’re now offering the industry’s most compact NVIDIA HGX B300 solutions—achieving up to 144 GPUs in a single rack—while reducing power consumption and cooling costs through our proven direct liquid-cooling technology. Through our DCBBS, this is how Supermicro enables our customers to deploy AI at scale: faster time-to-market, maximum performance per watt, and end-to-end integration from design to deployment.”
Super Micro Computer Inc. (NASDAQ:SMCI) is a seller and developer of server and storage solutions. It provides liquid and air-cooled AI servers, SuperStorage systems, MicroCloud server systems, embedded (5G/IoT/Edge) systems, and others. The firm serves artificial intelligence, edge computing, 5G, enterprise data centers, and cloud computing markets.
1. Carrier Global Corp. (NYSE:CARR)
Potential Upside: 35.77%
Number of Hedge Fund Holders: 48
Wolfe Research maintained its Outperform rating on the stock on December 9 but slightly lowered the price target from $75 to $74. This downward target price adjustment was part of the Research firm’s 2026 outlook for the multi-industry group. Although 2025 was a tough year for the sector, the firm anticipates moderate growth in 2026. Revenue momentum in the second half of 2025 is driving the analysts’ optimism. Rate cuts are also supporting the analysts’ sentiment.
Carrier Global Corporation (NYSE:CARR) issued a negative pre-announcement of its Q4 2025 earnings, which led to a downward target price adjustment by RBC Capital. On December 5, analysts at RBC Capital maintained an Outperform rating on the stock while lowering the target price from $75 to $70. Management said that the weak earnings are a result of the ongoing slowdown in its Americas residential HVAC segment. This segment alone makes up about 50% of CARR’s revenues. Following the company’s updated earnings outlook, RBC Capital also lowered its 2025 and 2026 estimates by 2% and 7%, respectively.
On December 4, an analyst at Wells Fargo also presented a similar stance on the stock. Analyst Joe O’Dea cut the price target for Carrier Global Corporation from $62.00 to $59.00 while maintaining an Equal Weight rating.
Carrier Global Corporation (NYSE:CARR) operates as an intelligent climate and energy solutions provider. It focuses on offering unique, digitally-enabled lifecycle solutions. The company operates through Refrigeration and Heating, Ventilating and Air Conditioning (HVAC) segments. It sells its products under different brand names, including Carrier, NORESCO, Carrier Transicold, Toshiba, Bryant, Day & Night, and Riello.
While we acknowledge the potential of CARR as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than CARR and that has 100x upside potential, check out our report about this cheapest AI stock.
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