Is Power Solutions (PSIX) The Best AI Stock Pick of Leopold Aschenbrenner’s Situational Awareness?

Published on June 24, 2026 at 5:08 pm by Fahad Saleem in News

We just covered Leopold Aschenbrenner’s Situational Awareness Reveals Its 10 Under-The-Radar AI Stock Picks. Power Solutions International (NASDAQ:PSIX) ranks #8 (see Situational Awareness Top 5 Under-The-Radar AI Stock Picks).

Situational Awareness Stake Value: $26,318,424

Power Solutions International (NASDAQ:PSIX) is a small-cap industrial company with a market cap of roughly $866 million that makes engines and power systems. It sells these primarily to industrial customers, with oil and gas being its largest end market. Its moat lies in its specialized engine manufacturing expertise and its established relationships with industrial and energy customers. Most of its revenue still comes from the oil and gas sector.

Since 2024, management has been attempting to reorient the business toward data center engines, which carry higher margins. The key facility driving this shift is its Wisconsin plant, which is currently in the middle of a capacity ramp-up. Management has said data center demand remains “solid” and expects sales to accelerate in the second half of 2026 as Wisconsin comes online.

In Q1 2026, net income and gross profit fell and results disappointed Wall Street. Management pointed to three causes: softer demand in oil and gas tied to elevated energy prices from the Middle East conflict, timing of certain power systems shipments that pushed revenue recognition beyond Q1, and elevated production costs from the Wisconsin ramp-up.

Bulls say these headwinds are transient and unlikely to persist. On oil and gas, they argue the Trump administration cannot afford high energy prices heading into midterms and was betting on a deal that would end the Iran war. That deal came recently and oil prices fell sharply. On shipment timing, they describe it as a standard one-time event in industrial businesses. On Wisconsin costs, they see this as the growing pain of building a higher-margin business.