AI Capex Crosses $1 Trillion Next Year. Here Are 2 Industrial Stocks That Will Benefit
2026-07-15 11:30
•Leo Sun •The Motley Fool
••••• ••• Axe Capital view
AI Infrastructure Booms: What It Means for SA Investors
AI-driven industrial spending is soaring globally, but South Africans should watch how USD/ZAR moves as infrastructure firms benefit abroad.
U.S. tech giants are set to spend over $1 trillion on AI infrastructure by 2027, sending ripples through companies that supply data centers. Vertiv and Quanta Services, both industrial plays, are growing fast thanks to their roles in cooling and powering the massive AI workloads. While they're not JSE-listed, their booming backlogs and partnerships, like Vertiv's with Nvidia, suggest sustained demand. For South African investors, this tech capex surge alone is a reason to keep an eye on USD/ZAR. A stronger dollar in this context could weigh on the rand, impacting everything from resource counters like AngloGold Ashanti to banks like Standard Bank that earn in foreign currencies. It’s tempting to chase offshore AI stocks, but without direct JSE exposure, the smarter move is to watch South Africa’s currency and how that feeds into local multinational earnings. If the AI buildout stalls or global growth slows, these trends could reverse quickly. this is just my opinion and not financial advice
Watch USD/ZAR closely; consider trimming rand-exposed earnings if the dollar gains on AI-driven tech capex. Avoid chasing unlisted offshore AI plays for now.
- USD/ZAR
- Standard Bank
- Global AI spending disappoints
- Rand strengthens unexpectedly on local factors
6/10
As AI spending by U.S. hyperscalers is projected to reach $1 trillion in 2027, industrial companies supporting data center infrastructure are positioned for significant growth. Vertiv Holdings and Quanta Services are highlighted as key beneficiaries, with Vertiv providing thermal management and power systems for AI chips, while Quanta builds transmission infrastructure to support power-hungry data centers.
This article was originally published by The Motley Fool and has been adapted here for Axe Capital Trading News.
Publisher: The Motley Fool
Author: Leo Sun
Categories: Equities, Earnings, Technology, AI, Semiconductors
Tickers: VRT, PWR, NVDA
Sentiment: Positive - Revenue more than doubled from 2021-2025, adjusted EBITDA tripled, backlog doubled year-over-year to $15B, and analysts expect 28% revenue and 38% EBITDA CAGRs through 2028. Strong partnership with Nvidia positions it well for AI infrastructure growth. Year-end backlog more than doubled from $19.3B to $44B (2021-2025), driven by cloud and AI market expansion. Analysts expect 17% revenue and 19% EBITDA CAGRs through 2028. Positioned to benefit from grid upgrades and renewable energy infrastructure buildout.
Keywords: AI capex, data center infrastructure, thermal management, power transmission, hyperscaler spending, industrial stocks
Insights:
- VRT: Positive: Revenue more than doubled from 2021-2025, adjusted EBITDA tripled, backlog doubled year-over-year to $15B, and analysts expect 28% revenue and 38% EBITDA CAGRs through 2028. Strong partnership with Nvidia positions it well for AI infrastructure growth.
- PWR: Positive: Year-end backlog more than doubled from $19.3B to $44B (2021-2025), driven by cloud and AI market expansion. Analysts expect 17% revenue and 19% EBITDA CAGRs through 2028. Positioned to benefit from grid upgrades and renewable energy infrastructure buildout.
- NVDA: Neutral: Mentioned as a partner to Vertiv and driver of demand for infrastructure upgrades due to power-hungry AI chips, but not the primary focus of the investment thesis.