Top 10 Stocks Offering High Upside Potential in Data Centers and AI

7. IREN Limited (NASDAQ:IREN)

Stock Upside Potential: 76.76%

Number of Hedge Fund Holders: 39

IREN Limited (NASDAQ:IREN) is one of the top stocks offering high upside potential in the data center and AI sectors. On November 10, Canaccord Genuity raised its price target on IREN Limited (NASDAQ:IREN) to $70 from $42, while keeping a Buy rating. The upgrade came after the company signed a new deal with Microsoft to supply GPU services across its Horizons 1–4 data centers, a move analysts say adds meaningful long-term value.

Canaccord’s analysis valued the Microsoft GPU project at about $22 per share, using a discounted cash flow model with an 8% weighted average cost of capital. The firm also lifted its valuation of IREN Limited’s Sweetwater 1 site from $24 to $32 per share, citing higher peer valuations, though it noted the site still trades at a discount compared to data centers with co-location agreements. In total, the $28 price target increase reflects $22 from the Microsoft deal and $6 from the Sweetwater upgrade.

On November 6, IREN Limited reported fiscal Q1 2026 revenue of $240.3 million, up from $187.3 million in the prior quarter. Most of this came from Bitcoin mining ($232.9 million), while AI cloud services contributed $7.3 million. Despite record revenue, investor concerns linger over rising costs and earnings expectations. Looking ahead, the company is targeting an annualized run rate of $3.4 billion by the end of 2026, supported by plans to deploy 40,000 GPUs in Canada and expand its AI cloud offerings.

IREN Limited (NASDAQ:IREN) is a leading AI cloud service provider, delivering large-scale GPU clusters for AI training and inference. Its vertically integrated platform is built on a portfolio of grid-connected land and renewable-powered data centers across the U.S. and Canada, positioning the company to benefit from growing demand for AI and high-performance computing.