On many occasions, the path of artificial intelligence (AI) in the stock market and the fact that this topic has accounted for a good part of the increases has been questioned. Data center companies are among the winners of the technology boom and analysts don’t think their glory days are over, quite the opposite. To the companies that build and operate these infrastructures They have plenty of potential left in the stock market. In some cases, experts see the possibility that the valuations of some of them will rise by more than 100% in the next 12 months.
Clients are hurrying and everyone wants to secure square meters of floor space. The demand for renting capacity in data centers is such that Contracts are closed before the facility is completely built, as if it were a new construction home in a stressed area. In fact, 90% of the portfolio of projects under development has already been awarded while the works progress, according to a Wells Fargo report.
Beyond the large technology companies that are part of this business, such as Microsoft, Amazon, Alphabet, Meta or SAP, there are companies that are specifically dedicated to this. But it is an industry in which socimis (known as REITs in the US) and cryptocurrency miners also participate. That is, there are real estate companies that manage other infrastructures in addition to these equipment and there are crypto firms that have diversified into computing. Some names stand out in the sector, such as Equinix, Applied Digital, Digital Realty, Cipher Mining, TeraWulf or Iron Mountain.
Data centers are essential to be able to process the enormous amount of data involved in AI. It is the basic infrastructure so that this technology can be developed and made available. Artificial intelligence requires a advanced and high-performance computing (HCP) capabilities, which implies greater complexity compared to other more basic computing tasks.
Analysts consider that these companies are going through a good time, since high demand gives them a position of strength. On the one hand, space and capacity reservations in data centers last year moved at record levels and clients are already closing contracts for the future. Furthermore, the sector has power to set prices and take advantage of expiring leases to raise rents, explain experts from firms such as Barclays or Mizhuo.
Furthermore, the best clients in the entire market are in this industry. Big technology companies have their own facilities (Microsoft plans to spend $80 billion on data centers in 2025), but they also hire third parties. These process a huge amount of data and demand on their part is assured. “They are fighting to acquire capacity,” says Wells Fargo.
“In the case of AI, the most attractive near-term opportunity may still be with market leaders, but will likely increasingly shift to companies that effectively deploy AI in their operations in a way that generates significant returns. of investment,” says Ronald Temple, chief market strategist at Lazard, about the gains in the stock market and how these will spread beyond technology companies.
Although the giants of Wall Street are a very juicy part of the clientele, Demand for cloud in general and more basic computing is also rising; It’s not just about everything that drives AI. Although perhaps the most famous projects are ChatGPT or Copilot, all types of companies need their place in data centers. It is known that the focus is now on AI language models such as that of OpenAI, but the future of artificial intelligence does not only go through words, but tools focused on image, video or audio processing will spread, one more lever.
“The race to build data centers and respond to AI has begun. The demand for data centers has already skyrocketed due to the role that data plays in modern society. But in addition, the emergence of generative artificial intelligence will imply even greater demand. And that portends a supply deficit,” notes a McKimsey report from October.
Although these firms are already benefiting on the stock market, analysts still give them Potential for the next 12 months: 109% for Bit Digital, 80.4% for TeraWulf, 70% for Cipher Mining, 34.7% for Applied Digital, 16.4% for Iron Mountain, 12.5% for Equinix and 8 .1% for Digital Realty.
Not only are data centers bustling on the stock market, but corporate operations are also heating up. Macquarie Asset Management is an investment firm and one of the largest data center REITs. This week it announced an investment of up to $5 billion in Applied Digital, a company in which Nvidia previously invested. KKR and Global Infrastructure Partners (GIP) bought CyrusOne for $15 billion, among other notable transactions.
Data centers like Spain
These companies have data centers all over the world and Spain is no exception. For example, Iron Mountain, Equinix and Digital Realty have infrastructure and projects in our country. It is ideal for these infrastructures due to its location as a connection point with America and Africa, its fiber network or the availability of land. Another key is that there is excess supply of electricity and data centers can absorb that surplus.
Most of these infrastructures are in Madrid, Barcelona and the autonomous community of Aragon. In addition, there are works underway and numerous projects announced.
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