In this article, we will discuss: 7 Best Data Center Hardware Stocks to Invest in.
On April 23, Reuters reported that Nokia CEO Justin Hotard cautioned that Europe risks slipping behind the United States and China in AI data center investment because of infrastructural gaps and insufficient investments. Hotard told Reuters that “Europe doesn’t have the infrastructure,” adding that the investment rate “is not enough” and that connection and data center capacity are required. He said if infrastructure lags, “business and developers will move to where that is,” naming China and the United States as current leaders.
Hotard said that data centers represent 3% of EU electricity demand, with consumption anticipated to skyrocket due to AI. Reuters quoted Amazon, which stated in February that challenges in acquiring power grid connections are impeding its European expansion. Nokia is branching out into AI, stating that its AI and cloud division accounts for 8% of group sales and projects that its addressable market would grow by 27% a year through 2028, proving rising demand despite geographical limitations.
With that said, here are the 7 Best Data Center Hardware Stocks to Invest in.
Photo from Oracle website
Methodology:
We used screeners to identify Data Center Hardware Stocks and 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).
7. Celestica Inc. (NYSE:CLS)
On April 29, Goldman Sachs raised Celestica Inc. (NYSE:CLS)’s price target from $430 to $475. It maintained a “Buy” rating. The firm noted that the company “beat on earnings.” However, it missed revenue in Enterprise because of component shortages in memory, power supply, and optics.
On April 27, Celestica Inc. had Q1 2026 sales of $4.05 billion with 53% growth YoY. The company had GAAP EPS of $1.83 and adjusted EPS of $2.16. Margins improved, with GAAP operating margin hitting 6.7% and adjusted operating margin 8.0%.
CEO Rob Mionis said that the firm “delivered a strong first quarter.” He added that the company witnessed fast growth in its CCS division and improved profitability.
The corporation lifted its 2026 sales forecast to $19.0 billion and adjusted EPS to $10.15. It expects Q2 2026 revenue to be between $4.15 billion and $4.45 billion and adjusted EPS to be between $2.14 and $2.34.
Celestica Inc. delivers global supply chain solutions for equipment manufacturers and service providers. It works in two divisions, which are Advanced Technology Solutions and Connectivity and Cloud Solutions.
6. Dell Technologies Inc. (NYSE:DELL)
On April 15, Dell Technologies Inc. (NYSE:DELL) CEO Michael Dell told CNBC Television that U.S. lawmakers should avoid blocking artificial intelligence development, warning that overregulation could allow rivals to gain an advantage. Dell opposed Senator Bernie Sanders’ proposed data center moratorium. He called it “not a great idea.” He also argued that slowing or regulating it would give a geopolitical edge to competitors.
Dell pointed out AI as a “highly competitive” global competition, advocating sustained big investments to maintain US leadership. “If we want to advance as a society…we need AI,” he continued, stressing the importance of energy efficiency and cautious data center placement.
Regarding export limits, Dell stated that it benefits the United States to spread its technology stack abroad, but he cautioned that “super powerful aspects” should remain out of the hands of competitors.
He focused on the industry’s complexity and stated that semiconductor supply chains span “20 or 30 countries,” with no single nation controlling them.
Dell Technologies Inc. is a technology company. It operates in two segments: Infrastructure Solutions Group (ISG) and Client Solutions Group.
5. Eaton Corporation plc (NYSE:ETN)
On April 8, Eaton Corporation plc (NYSE:ETN) invested over $30 million in U.S. production, constructing a switchgear facility in Bellevue, Nebraska. The investment is to meet high demand from AI data center customers. The company stated that the facility will give preference to speed and quality for medium-voltage equipment use in power distribution systems.
Separately, on April 13, Citi lifted Eaton Corporation plc (NYSE:ETN)’s price target to $464 from $435. It retained a Buy rating on the stocks and modified industrial sector expectations for Q1. Citi believes “gradually improving” manufacturing fundamentals can improve profit momentum.
The firm sees 7-9% organic growth in 2026 with segment margins of 24.6-25.0%. It forecasts EPS of $11.57-$12.07, with adjusted EPS of $13.00-$13.50. In the first quarter of 2026, the company expects organic growth of 5-7%, segment margins of 22.2-22.6%, EPS of $2.29-$2.49, and adjusted EPS of $2.65-$2.85.
Eaton Corporation plc (NYSE:ETN) is a power management firm that presents energy-saving solutions for electrical, hydraulic, and mechanical power. It works in the Electrical Americas and Electrical Global; Aerospace, Vehicle, and eMobility segments.
4. Super Micro Computer, Inc. (NASDAQ:SMCI)
On April 16, JPMorgan reduced its price target for Super Micro Computer, Inc. (NASDAQ:SMCI) from $40 to $28. It maintained a Neutral rating on the stock and updated hardware and networking coverage ahead of Q1. The firm expected AI infrastructure expenditure across servers, switches, and interconnects to drive supplier upside.
On April 7, Reuters reported that Super Micro Computer, Inc. launched an independent inquiry. This happened after the US Justice Department charged co-founder Yih-Shyan Liaw, sales manager Ruei-Tsang Chang, and contractor Ting-Wei Sun with alleged violations of export controls. It involved the routing of US-made servers through Taiwan into Southeast Asia before shipment to China.
The company conducted an internal assessment of its global trade compliance program, sending Liaw and Chang on leave, terminating Sun, and confirming Liaw’s resignation from the board in March.
According to Reuters, independent directors Scott Angel and Tally Liu are overseeing the investigation involving Munger, Tolles & Olson and AlixPartners, but no completion date has been revealed.
Super Micro Computer, Inc. operates as a seller and developer of server and storage solutions based on modular, open-standard architecture across Europe, the United States, Asia, and internationally. It provides liquid and air-cooled AI servers.
3. Advanced Micro Devices, Inc. (NASDAQ:AMD)
On April 24, CNBC reported that Advanced Micro Devices, Inc. (NASDAQ:AMD) shares went up by over 12%, citing investor reaction to Intel’s latest earnings. Intel saw a high CPU demand due to AI buildouts, leading investors to buy AMD.
Gil Luria, an analyst at D.A. Davidson, said that Intel’s performance showed a “very significant upside” and that CPUs are “reinserting” as essential AI infrastructure. Luria upgraded Advanced Micro Devices, Inc. to buy from neutral and lifted his price target to $375, representing a 22% increase.
Citi analyst Atif Malik said Intel now forecasts “double-digit server CPU unit growth in 2026,” raising his recommendation to buy from neutral. According to Roth analyst Suji Desilva, improved AI infrastructure participation led to a stronger valuation expectation among peers, including Advanced Micro Devices, Inc..
Barclays analyst Tom O’Malley has warned of potential share movements, stating that his downside case implies “greater share loss to AMD.”
Advanced Micro Devices, Inc. works in the semiconductor industry. Its product line includes processors, accelerators, graphics, adaptive SoCs, FPGAs, and SOMs, as well as software, tools, and apps. The company provides artificial intelligence, industries, workload, and gaming solutions.
2. Vertiv Holdings Co (NYSE:VRT)
On April 22, Vertiv Holdings Co (NYSE:VRT) reported solid first-quarter growth, with net sales of $2.65 billion, a 30% upsurge YoY. The corporation reported an operating profit of $440 million, a 51% increase. It also had an adjusted operating profit of $551 million, with a 64% growth. The firm improved its adjusted operating margin to 20.8%, up 430 basis points, because of rising volumes and price-cost savings.
The corporation had $767 million in operating cash flow, a 153% spike, with adjusted free cash flow being $653 million, up 147%.
According to CEO Giordano Albertazzi, “customers prioritizing optimized design, deployment speed, and operational efficiency,” showing that demand is linked to changing data center requirements. Executive Chairman Dave Cote said that clients chose the firm “because we can deliver at scale.”
Vertiv Holdings Co updated its full-year goals and forecasted net sales of $13.5 billion to $14.0 billion and adjusted EPS of $6.30 to $6.40.
Vertiv Holdings Co is a company that produces, designs, and services critical digital infrastructure technology for data centers, communication networks, and commercial and industrial applications.
1. NVIDIA Corporation (NASDAQ:NVDA)
Reuters on April 22 cited Commerce Department Secretary Howard Lutnick reporting that NVIDIA Corporation (NASDAQ:NVDA) has not sold its H200 AI chips to Chinese enterprises. Lutnick stated, “We have not sold them chips as of yet,” attributing the delay to China’s central government banning acquisitions so as to favor domestic market investment.
As reported by Reuters, the Trump administration approved H200 shipments to China in January with conditions, which caused concerns among US lawmakers about potential military use. Sources told Reuters that conflicts over sales terms in both countries have slowed supplies even further.
Lutnick said that the affiliates rule blocking exports to thousands of Chinese businesses is still being considered. However, it is linked to broader trade negotiations. He also stated that President Donald Trump, Treasury Secretary Scott Bessent, and Trade Representative Jamieson Greer are in charge of China policy, while he focuses on other issues.
NVIDIA Corporation designs and manufactures computer graphics processors, chipsets, and related multimedia applications. It functions in two segments: graphics processing unit and compute and networking.
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