In this article, we will take a look at the Top 10 Stocks Offering High Upside Potential in Data Centers and AI.
The artificial intelligence boom has pushed valuations in the equity markets to elevated levels, according to strategists at Bank of America. That’s evident, as the S&P 500 is trading at 23 times its forward earnings, well above its two-decade average of 16, owing to its significant exposure to the “magnificent seven” groups of tech giants at the heart of the AI trade.
The S&P 500 value has increased by approximately $17 trillion since it bounced off its April low, attributed to the ongoing AI trade. The significant value increase comes at the back of companies ramping up AI investments in a bid to strengthen their competitive edge and launch new products and services. Likewise, eight of the tech companies valued at over $1 trillion are all tied to AI.
Amid the AI boom rhetoric surrounding a potential bubble, are already sending shivers down Wall Street. Billionaire Jeff Bezos is the latest high-profile personality to join the chorus reiterating that AI is in an industrial bubble. According to Bezos, some stock prices are disconnected from fundamentals as part of the AI trades.
“The [bubbles] that are industrial are not nearly as bad, it can even be good, because when the dust settles and you see who are the winners, societies benefits from those inventions. That is what is going to happen here too. This is real, the benefits to society from AI are going to be gigantic,” Bezos said
Bezos joins OpenAI CEO Sam Altman and Goldman Sachs CEO David Solomon, who have raised concerns about market levels amid the AI boom.
Amid the concerns, there are artificial intelligence and data center investment plays currently trading at discounted valuations with significant upside potential.
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Our Methodology
To identify Top Stocks Offering High Upside Potential in Data Centers and AI, we used ETFs and financial media reports to identify popular AI and data center stocks, then selected the top 30 most popular stocks with the highest upside. We then narrowed our list to companies deeply engaged in AI or data‑center development, showing more than 30% upside potential as of November 18 and notable hedge fund interest in Q2 2025. Finally, we arranged the selected stocks in ascending order of their upside potential.
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 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
Top Stocks Offering High Upside Potential in Data Centers and AI
10. Meta Platforms Inc. (NASDAQ:META)
Stock Upside Potential: 38.89%
Number of Hedge Fund Holders: 260
Meta Platforms Inc. (NASDAQ:META) is one of the top stocks offering high upside potential in data centers and AI. On November 13, Wedbush added Meta Platforms Inc. (NASDAQ:META) to its Best Ideas list and kept its $920 price target, pointing to stronger sentiment after a solid Q3.
The firm said Meta’s higher spending makes sense given the push to weave AI deeper into its ad and content systems, and it highlighted steady gains in the core advertising business, progress from Meta AI and Superintelligence Labs, and new AI-driven hardware. On October 29, Meta reported a strong third-quarter, posting EPS of $7.25 versus $6.69 expected and surpassing $50 billion in revenue for the first time.
Earlier on October 30, Meta Platforms Inc. announced plans to raise $30 billion through its largest bond offering. The company is to raise $30 billion in a six-part bond sale with maturities ranging from five to 40 years. The bond amounts are to range between $4 billion and $6.5 billion. The company has already struck a $27 billion financing deal with Blue Owl Capital to fund its biggest data center project in Louisiana.
The $30 billion capital raise comes as the tech giant’s race against time to fund costly artificial intelligence infrastructure. Like other tech heavyweights, Meta finds itself in a period of heightened investments in AI as it seeks to enhance its offerings. The company is also spending big to attract and retain AI researchers and engineers. Likewise, the investment spree has resulted in significant cost pressures, with employee compensation costs emerging as the second-largest contributor to the cost increase.
Meta Platforms Inc. (NASDAQ:META) is a social networking company that builds massive, AI-focused data centers globally to power its AI services and future technologies. It invests billions in infrastructure, custom-designed chips, and sustainable practices, including renewable energy and water conservation. These facilities address the immense computational needs for AI development, personalized content delivery, and future platforms, such as universal AI agents and immersive experiences.
9. Oracle Corp. (NYSE:ORCL)
Stock Upside Potential: 60.34%
Number of Hedge Fund Holders: 124
Oracle Corp (NYSE:ORCL) is one of the top stocks offering high upside potential in data centers and AI. On November 16, Jefferies analyst Brent Thill reaffirmed his Buy rating on Oracle Corp (NYSE:ORCL) and assigned a $400 price target.
Earlier on November 6, Oracle Corporation signed a strategic partnership with Defense Technologies to deliver artificial intelligence innovations for global defense and national security customers.
The two companies are joining forces to provide access to sovereign cloud and AI solutions across Oracle Cloud Infrastructure. The ultimate goal is to enable clients to stay ahead of adversaries, benefit from the latest AI innovations, and reduce costs.
Likewise, defense customers will be able to deploy sovereign AI-enabled software products at scale using Oracle’s distributed cloud services,
“Oracle is committed to ensuring its cloud can support the most demanding missions in defence and national security,” said Jason Rees, Senior Vice President, Technology Engineering, and Oracle EMEA. “Through our newly launched Defense Ecosystem, we are creating an environment where sovereign innovation can scale. This collaboration with Defence Technologies provides an immediate proof point, showing how founding members, like Whitespace, are already leveraging the program to deliver sovereign AI capabilities across allied nations.”
Oracle Corp (NYSE:ORCL) is a software application company that integrates Artificial Intelligence (AI) and Machine Learning (ML) across its entire technology stack—from high-performance cloud infrastructure to its enterprise software applications and database services—to provide built-in automation, enhanced analytics, and generative AI capabilities for businesses.
