8 Best Small Cap Data Center Stocks to Buy

In this article, we take a look at the 8 Best Small Cap Data Center Stocks to Buy.

Last week, S&P Global reported that private equity investment in US data centers reached its highest level in five years in 2025, jumping to $45.70 billion. Citing its own Market Intelligence data, S&P said this accounts for 72% of the overall $63.35 billion investment in the nation’s data center space, including transactions not backed with private equity.

S&P Global said private equity investors are pouring billions into digital infrastructure as artificial intelligence (AI) is driving unprecedented demand for data centers. It added:

“The private equity-backed investment total was driven by one deal: the planned $40 billion acquisition of Aligned Data Centers LLC by a group of investors including MGX Fund Management Ltd., Global Infrastructure Management LLC, Microsoft Corp., X.AI LLC, NVIDIA Corp., Temasek Holdings (Pvt.) Ltd., Kuwait Investment Authority and BlackRock Inc.”

Citing insights from JLL Data Center Solutions Vice Chairman Curt Holcomb, the report noted that the country is at the “beginning of a data center supercycle development process”.

Holocomb explained that this refers to a period of prolonged deep development for three to five years, which is driven by a severe supply-and-demand imbalance where demand exceeds available supply.

According to data from 451 Research from S&P Global Energy Horizons, the U.S. has a total of 3,988 data centers as of the third quarter of 2025. Of these, 2,615 are operational, 1,108 are planned, and 265 are under construction.

S&P Global cited the state of Virginia as the capital of America’s digital infrastructure, with 757 total data centers, including 382 operational facilities and 306 more in the planning stages. It added:

“However, other states are preparing to capture the next wave of digital growth. While Virginia’s planned facilities ensure its continued dominance, the combined pipelines of Ohio, with 111 planned and under construction, Arizona, with 102, and Georgia, with 97, signal a dramatic decentralization of cloud computing infrastructure.”

With the continued investment in data centers, let’s take a look at the 8 Best Small Cap Data Center Stocks to Buy.

Our Methodology

To compile our list of the best data center stocks, we leveraged ETFs, industry research, and proprietary databases to screen for U.S.-listed companies that are either pure-play data center operators or have significant exposure to the sector or benefit from cloud infrastructure growth. We limited our search to stocks with a market capitalization of below $2 billion. From this pool, we selected the 8 stocks most widely owned by hedge funds, based on Q4 2025 filings from Insider Monkey’s database. These names were then ranked by the number of hedge funds holding positions in them.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research shows 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).

Note: All pricing data is as of market close on May 15, 2026.

8. Crexendo, Inc. (NASDAQ:CXDO)

Market capitalization: $320.59 million

Number of Head Fund Holders: 7

Crexendo, Inc. (NASDAQ:CXDO) is one of the best small cap data center stocks to buy. In the past year, the stock has surged 65.94% while it recorded a 49.17% jump year-to-date. Crexendo continues to receive a strongly positive consensus view, with all six analysts covering it rating it Buy, according to ratings compiled by CNN. The stock currently has a median price target of $11, an 11.22% upside from the current price of $9.89.

On May 7, TheFly reported that Lake Street analyst Eric Martinuzzi increased the price target on Crexendo to $11 from $9 while maintaining a Buy rating on the stock. The analyst attributed the price increase to the company’s positive first-quarter financial performance.

On May 6, Crexendo reported a 29% increase in consolidated total revenue for the first quarter of the year, to $20.7 million, up from $16.1 million in the same quarter a year ago. The company reported a GAAP net income of $0.6 million alongside non-GAAP net income of $3.3 million.

Crexendo CEO and Chairman Jeff Korn emphasized that the company was able to extend its GAAP profitability streak to 10 consecutive quarters, despite absorbing acquisition-related expenses related to Estech Systems (ESI). He added:

“The ESI acquisition is performing ahead of our expectations and is already contributing meaningfully to both revenue and operational momentum. Integration is progressing well, with strong alignment across sales, operations, and engineering, and we are beginning to see early synergies that we expect to build on overtime. Our Q1 results only included 1 month of ESI contributions and I am excited about the impact we will see going forward from this significant acquisition.”

Crexendo, Inc. (NASDAQ:CXDO) is a software technology company that provides a cloud communication platform and services, video collaboration, and managed IT services tailored to businesses of all sizes.

7. Hyliion Holdings Corp. (NYSE:HYLN)

Market Capitalization: $832.79 million

Number of Hedge Fund Holders: 9

Hyliion Holdings Corp. (NYSE:HYLN) is one of the best small cap data center stocks to buy. On May 12, Hyliion reported research and development service revenue of $2.8 million, approximately 479% higher than the $489,000 it generated in the same period a year ago.

The company attributed the revenue growth to an acceleration of work under its contracts with the Office of Naval Research, including the construction of the 800-kilowatt KARNO Power Module, which is being delivered to the Navy. During the quarter, Hyliion commenced the building of the said power module, with completion expected this year.

Hyliion said the 800-kilowatt architecture also serves as the foundational building block for the company’s data center offering, scalable to 2.4 and 3.2 megawatts to match the modular power requirements of data center customers.

For this year, the company is maintaining full-year revenue guidance of approximately $10 million from R&D services and potential initial sales to commercial customers, following the commercialization of the 200-kilowatt KARNO Power Module, expected late in the year.

Hyliion Holdings Corp. (NYSE:HYLN) provides innovative solutions that enable clean, flexible, and affordable electricity production. The Company’s primary focus is to provide modular power plants that can operate on various fuel sources to future-proof against an ever-changing energy economy.

6. Soluna Holdings, Inc. (NASDAQ:SLNH)

Market Capitalization: $251.26 million

Number of Hedge Fund Holders:11

Soluna Holdings, Inc. (NASDAQ:SLNH) is one of the best small cap data center stocks to buy. In a Securities and Exchange Commission (SEC) filing on May 11, the company issued a prospectus on the planned resale of 2,459,400 common shares with a par value of $0.001 per share. The offering includes 2.4 million warrant shares issuable to YA II PN, LTD upon exercise of a warrant and 59,400 merger shares issuable to Harmattan Energy Ltd., formerly Soluna Technologies, Ltd.

Meanwhile, earlier this month, Soluna said it is now in full compliance with all NASDAQ continued listing requirements as it received notice from the exchange that it has regained compliance with the minimum bid price requirement under NASDAQ Listing Rule 5550(a)(2).

“We’ve done the work to meet Nasdaq’s requirements, and more importantly, to strengthen the business underneath it. Our focus remains on disciplined execution, scaling our Renewable Computing platform, and creating durable value for shareholders,” Soluna Holdings CEO John Belizaire said.

Soluna Holdings, Inc. (NASDAQ:SLNH) designs, develops, and operates digital infrastructure that transforms surplus renewable energy into global computing resources. The company’s pioneering data centers are strategically co-located with wind, solar, or hydroelectric power plants to support high-performance computing applications, including Bitcoin Mining, Generative AI, and other compute-intensive applications.

5. HIVE Digital Technologies Ltd. (NASDAQ:HIVE)

Market Capitalization: $952.48 million

Number of Hedge Fund Holders: 14

HIVE Digital Technologies Ltd. (NASDAQ:HIVE) is one of the best small cap data center stocks to buy. On May 8, HIVE announced that its wholly owned subsidiary, BUZZ High Performance Computing, has contracted a new fiber optic network overbuild and an upgrade of the carrier transport network at its Grand Falls Data Center in New Brunswick.

The company said the estimated capital commitment from HIVE will be approximately $3.1 million for a period of five years. HIVE emphasized that this is a critical infrastructure step to advance the HIVE New Brunswick campus to a Tier III HPC-enabled data center.

Currently, Grand Falls is already energized at 70 MW gross load, HIVE noted, adding that buildings and core electrical infrastructure are in place. It added that BUZZ is converting the site into a 50 MW Tier III+ AI factory designed for enterprise, government, and sovereign AI workloads.

HIVE and BUZZ Executive Chairman Frank Holmes emphasized that AI is the new industrial race. He added:

“Countries that build sovereign AI factories will raise their productivity and security through data sovereignty, ensuring data doesn’t leave the countries’ borders, providing those nations greater data IQ. Countries that do not have their own sovereign AI infrastructure will depend on foreign infrastructure and thus rent intelligence from others.”

Holmes said the fiber overbuild is the superhighway that moves that intelligence to customers. He further said:

“Power plus fibre plus GPUs equals an AI factory. New Brunswick has the chance to become one of Canada’s most important AI infrastructure hubs. We are flourishing in the AI token economy, and our vision is to consume electrons and export tokens. The vision is to turn Canadian power into Canadian AI tokens of intelligence.”

HIVE Digital Technologies Ltd. (NASDAQ:HIVE) builds and operates next-generation Tier-I and Tier-III data centers across Canada, Sweden, and Paraguay, serving both Bitcoin and high-performance computing clients. The company’s twin-turbo engine infrastructure, driven by hashrate services and GPU-accelerated AI computing, delivers scalable, environmentally responsible solutions for the digital economy.

4. Bit Digital (NASDAQ:BTBT)

Market Capitalization: $589.47 million

Number of Hedge Fund Holders: 18

Bit Digital (NASDAQ:BTBT) is one of the best small cap data center stocks to buy. Despite posting lower revenues in the first quarter of the year, Bit Digital remained firm on its Ethereum-focused strategic asset game plan, which is centered on treasury management, staking, and disciplined capital allocation, the company said on May 14.

Bit Digital Chief Executive Officer Sam Tabar expressed optimism for the convergence of Ethereum and AI, emphasizing that Ethereum infrastructure and AI compute infrastructure are components of a single integrated platform aligned with the future of the digital financial system. He added:

“Ethereum infrastructure will become increasingly important to the future digital financial system as stablecoins, tokenization, and on-chain settlement activity continue scaling globally. The future financial system will increasingly revolve around automated, on-chain value transfer between AI agents and applications — Ethereum is particularly well-positioned to serve as the settlement layer for that activity.

Bit Digital sits at both layers of this thesis: providing the compute infrastructure through WhiteFiber and the settlement rails through our Ethereum treasury and staking platform. Demand for compute and power continues exceeding available supply across AI infrastructure markets, and compute itself is scarce and valuable enough to become a new asset class.”

Bit Digital (NASDAQ:BTBT) is a strategic asset company focused on active participation in Ethereum infrastructure and controlling equity exposure to AI/HPC infrastructure through its majority ownership stake in WhiteFiber.

3. Clearfield, Inc. (NASDAQ:CLFD)

Market Capitalization: $591.14 million

Number of Hedge Fund Holders: 18

Clearfield, Inc. (NASDAQ:CLFD) is one of the best small cap data center stocks to buy. On May 12, Clearfield Inc. President and CEO Cheri Beranek said the company expects to begin shipping the newly introduced NOVA platform in the third or fourth quarter of the year.

At the 21st Annual Needham Technology, Media, & Consumer Conference, Beranek said she was surprised by the data center community’s receptiveness to its NOVA product line, as it recognized the company’s expertise in fiber management. She added:

“And so, we really have received a strong open door welcoming from the data center community, and we expect that we’ll start to see the Nova platform business in the third and fourth quarter.”

In January, Clearfield announced the launch of the NOVA Platform, a modular, high-density fiber ecosystem designed to make building and scaling modern networks more intuitive. The company explained that the platform is engineered for a range of environments, such as large hyperscale and co-location data centers, offering space-efficient solutions that can evolve as quickly as their capacity demands.

Clearfield, Inc. (NASDAQ:CLFD) designs, manufactures, and distributes fiber optic management, protection, and delivery solutions.

2. Alpha & Omega Semiconductor Limited (NASDAQ:AOSL)

Market Capitalization: $1.16 billion

Number of Hedge Fund Holders: 19

Alpha & Omega Semiconductor Limited (NASDAQ:AOSL) is one of the best small cap data center stocks to buy. On May 12, the Alpha & Omega announced the completion of its equity transfer agreement for the sale of its interest in its Chongqing, China-based joint venture, the company announced in a filing to the Securities and Exchange Commission (SEC).

Under the transaction, Alpha & Omega Semiconductor Limited and its subsidiary, Alpha & Omega Semiconductor (Shanghai) Ltd., entered into an equity transfer agreement with SIMIC Holdings Co., Ltd. for the sale of the company’s approximately 20.3% of outstanding equity interest in its joint venture of power semiconductor packaging, testing, and 12-inch wafer fabrication facility located in Chongqing, China. Prior to the transaction, the company had a 39.2% of the joint venture.

Alpha & Omega Semiconductor said the sale had a purchase price of $150 million paid in four installments. It announced the completion of the transaction after receiving the final installment on May 11.

In July last year, Alpha & Omega said the transaction would provide it with additional and significant capital for the company to continue investment in technology and R&D projects. Additionally, it will also support efforts for the acquisition of assets complementary to our business operations, which will facilitate and accelerate its initiative in developing innovative and diverse power semiconductor products. It added:

“Importantly, the sale does not impact our ongoing business relationship with CQJV, and we will continue to enjoy access to CQJV’s wafer manufacturing and assembly and test capacity provided under existing agreements, as well as protection for our proprietary technology and intellectual property.”

Alpha & Omega Semiconductor Limited (NASDAQ:AOSL) is a designer, developer, and global supplier of a broad range of discrete power devices, wide bandgap power devices, power management ICs, and modules.

1. Willdan Group, Inc. (NASDAQ:WLDN)

Market Capitalization: $1.39 billion

Number of Hedge Fund Holders: 30

Willdan Group, Inc. (NASDAQ:WLDN) is one of the best small cap data center stocks to buy. According to analyst ratings compiled by CNN, the stock continues to receive a strong Buy rating, with an average price target of $135, representing a 46.55% upside from the current price of $92.12. In the past year, the stock has grown 82.49%, while it posted a 13.63% year-to-date decline.

On May 7, the company reported an 8.3% rise in net revenue to $92.4 million for the first quarter of the year, driven by demand for its energy solutions. The company also reported an 82% jump in its net income to $8.5 million and a 44.4% increase in adjusted diluted EPS of $0.91.

Willdan President and Chief Executive Officer Mike Bieber said first-quarter results reflect strong demand for the company’s energy solutions. He emphasized that the company’s recent acquisition of Burton Energy Group expands its energy offerings. He added:

“Burton is a management consultant and solutions provider that strengthens our national presence, deepens our energy efficiency capabilities and adds energy procurement. Reflecting the strength of our underlying business and outlook, we are raising our 2026 financial targets and long-term margin goal. We now expect 2026 Adjusted EBITDA growth to increase by 26% to 32% year over year.”

Willdan Group, Inc. (NASDAQ:WLDN) is a technical services company focused on energy and infrastructure solutions. Among its offerings are energy planning and analytics, consulting, software, public finance, engineering, and program implementation.

READ NEXT: 8 Best Digital Infrastructure REITS to Buy According to Analysts and 10 Best American AI Stocks to Buy Now.

Disclosure: None. Follow Insider Monkey on Google News.