Despite the recent AI-driven sharp sell-off in software stocks and doubts over Big Tech’s massive AI and data center spending, several data center stocks still carry Strong Buy ratings with substantial upside. This article highlights three such: Nvidia (NVDA), Arista Networks (ANET), and Vertiv Holdings (VRT).
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Nvidia (NVDA)
Nvidia is popularly known as the leader in AI chip design and enjoys strong industry patronage for its graphics processing units, related central processing units, and networking solutions. These products underpin infrastructure for data centers and high-performance computing, gaming, and PC hardware, as well as autonomous driving development, among other applications.
Despite the recent pullback, Nvidia’s shares still carry about 50% upside with an average price target of $260.06 from 39 analysts. This breaks down to 37 Buys, one Hold, and one Sell rating issued over the past three months.
Arista Networks (ANET)
Arista provides cloud networking solutions, such as the high-speed Ethernet switches that data centers require to run AI clusters. It serves markets beyond the tech sector, including media and entertainment, financial services, and government agencies.
The California-based company’s shares currently boast about 33% upside based on an average price target of $170.44 from 12 analysts. This breaks down to 10 Buys and two Holds issued over the past three months.
Vertiv Holdings (VRT)
This Ohio-based company is a critical digital infrastructure vendor for power, cooling, racks, and related systems that data centers need to run properly. It also provides the management systems for monitoring and controlling digital infrastructure. Its shares have jumped about 11% since the start of the year.
Vertiv’s shares currently boast about 17% upside based on an average price target of $208.89 from 10 analysts. This breaks down to nine Buys and one Hold rating over the past three months.
