Published: January 2, 2026 | Category: Infrastructure, AI Data Center, Construction
$1 TRILLION+ data center capex by 2029! Infrastructure stocks are the “Physical AI” plays winning in 2025! ๐๏ธ As AI demands exponential increases in power and cooling, companies that build the physical backbone are becoming unlikely winners.
According to Dell’Oro Group, worldwide data center capex is projected to surpass $1 trillion by 2029 with a 21% CAGR. The Top 4 US cloud providers (Amazon, Google, Meta, Microsoft) will account for nearly half of global data center capex in 2025. This is the largest infrastructure buildout in history!
BlackRock’s Global AI Infrastructure Investment Partnership (GAIIP) calls this “mobilizing private capital to build AI infrastructure” โ a multi-trillion dollar long-term investment opportunity. BCG estimates hyperscalers may need to invest $1.8 trillion on data center capex by 2030 in the US alone.
#1. Vertiv Holdings Co. (VRT)
2025 Performance Analysis
Vertiv has emerged as the “next essential AI infrastructure stock” with 3-year total shareholder returns above 1,100% โ comparable to NVIDIA’s legendary run! The company solves AI’s “analog problems”: Power and Heat.
Q3 2025 showed explosive growth: net sales of $2.676 billion (+29% YoY), organic orders up ~60% YoY and +20% sequentially. Book-to-bill ratio hit ~1.4x, pushing backlog to a record $9.5 billion (+30% YoY). The company is transforming into a full-stack AI infrastructure provider.
Vertiv is a leader in liquid cooling solutions critical for AI workloads. The $1 billion acquisition of PurgeRite expands its liquid cooling services portfolio. Partnerships with NVIDIA, CoreWeave, Dell, and Oklo position it for next-gen AI data centers requiring 50-100 kW per rack (vs 5-15 kW traditional).
- Net Sales: $2.676B (+29% YoY)
- Organic Orders: +60% YoY
- Backlog: $9.5 billion (+30% YoY)
- Book-to-Bill: ~1.4x
- Adjusted Operating Margin: 22.3% (+220 bps YoY)
- 3-Year TSR: >1,100% (NVIDIA-comparable!)
2026 Outlook
S&P Global predicts worldwide data center power consumption will nearly double by 2030. Precedence Research forecasts the data center cooling market to grow at ~12% CAGR through 2035. Vertiv trades at 38x FY25 earnings, reflecting investor confidence in a multi-year AI infrastructure supercycle. Analyst consensus target: $188 (+16% upside).
#2. MasTec Inc. (MTZ)
2025 Performance Analysis
MasTec is strengthening its position in the power infrastructure market with Power Delivery emerging as a key growth pillar. The company benefits from long-term trends in grid modernization and rising electricity demand driven by AI data centers.
Q2 2025 Power Delivery segment revenues increased +20% YoY, exceeding expectations by $50 million. Backlog for Power Delivery increased 14% YoY. Communications and power delivery benefit from broadband expansion, grid modernization, and data center-related power demand.
MasTec’s diversified portfolio includes clean energy, 5G infrastructure, and pipeline work. Rising power consumption and aging grid infrastructure are prompting utilities to commit substantial capital toward reliability, renewable integration, and new generation capacity.
- YTD Performance: +62%
- Power Delivery Revenue: +20% YoY
- Power Delivery Backlog: +14% YoY
- 2026 EPS Estimate: $8.12 (+27% YoY)
- Forward P/E: 27.09x
2026 Outlook
New project awards anticipated in upcoming quarters with growing demand from traditional utilities and emerging areas such as data centers. MasTec sees substantial capital commitments across transmission, substations, renewables, and gas-fired generation. 2026 EPS estimate: $8.12 (+27% YoY growth).
#3. Quanta Services Inc. (PWR)
2025 Performance Analysis
Quanta Services sits at the center of one of the most capital-intensive infrastructure cycles in decades. The company is uniquely positioned to meet the explosive rise in power demand driven by data centers, advanced manufacturing, and electrification.
Q3 2025 backlog reached a record $39.2 billion, up from $33.96 billion a year ago. Remaining performance obligations rose to $21 billion. The NiSource engagement involves designing and constructing approximately 3 GW of generation capacity for a major data center customer.
Quanta’s competitive advantage lies in scale: 68,000+ craft-skilled workers with deep experience across transmission, substations, renewables, battery storage, and now generation. Its integrated “total solutions” platform provides greater revenue visibility and positions it as a preferred long-term partner for utilities.
- Record Backlog: $39.2 billion (+15% YoY)
- Remaining Performance Obligations: $21 billion
- Workforce: 68,000+ craft-skilled workers
- Forward P/E: 35.09x
- 2026 EPS Growth: +16.9% YoY
2026 Outlook
Analysts project 18.1% EPS growth in 2025 and 16.9% in 2026. Data centers require massive, reliable, and often accelerated power solutions, pushing utilities to expand transmission, substations, and generation capacity. Quanta sits directly at this intersection. PWR is considered “the biggest winner from data center power demand.”
#4. Sterling Infrastructure Inc. (STRL)
2025 Performance Analysis
Sterling Infrastructure has skyrocketed ~1,500% in the past five years, crushing the S&P 500’s 85% return. The company specializes in the first phase of construction: site selection, planning, and site prep for mission-critical facilities including data centers.
Q3 2025 showed exceptional 125% YoY increase in data center revenues! E-Infrastructure segment revenues rose 18% YoY with data center-related activity expanding ~60% vs prior year. Data center projects now represent more than 65% of the segment’s backlog.
The CEC Facilities Group acquisition expands services into mission-critical electrical contracting. Signed backlog grew 34% YoY to $2.6 billion. Combined backlog and high-probability future phase work gives visibility into more than $4 billion in potential work.
- Data Center Revenue: +125% YoY
- Signed Backlog: $2.6 billion (+34% YoY)
- Total Pipeline: $4+ billion visibility
- 5-Year Return: ~1,500%
- $400M Stock Repurchase Program authorized
- Analyst Rating: 4 “Strong Buy” recommendations
2026 Outlook
Sterling is projected to grow revenue by 13% in 2025 and 19% in 2026 to reach $2.84 billion. 2025 EPS estimate: $10.35-$10.52 (+57% YoY). 2026 EPS estimate: ~$11 (+15% YoY). All four brokerage recommendations are “Strong Buy.” Project sizes and complexity continue to rise driven by mission-critical facilities and greater underground utility requirements.
#5. EMCOR Group Inc. (EME)
2025 Performance Analysis
EMCOR plays a critical role inside the data center, delivering electrical, mechanical, and HVAC systems that support power distribution, cooling, and redundancy within facilities. The company stands out for execution discipline, margin resilience, and expanding exposure to data centers.
Record remaining performance obligations (RPO) driven by network, communications, and data center projects where demand has nearly doubled YoY. Electrical and mechanical construction businesses benefit from strong project mix, prefabrication capabilities, and disciplined contract selection.
EMCOR’s service businesses add recurring revenue and cushion cyclical swings. Balance sheet strength allows for continued investment and acquisitions. Data center, healthcare, and manufacturing projects drive backlog growth.
- YTD Performance: +38%
- Data Center RPO: Nearly doubled YoY
- 2026 EPS Estimate: $27.41 (+8.6% YoY)
- 2026 Revenue Growth: +5.7%
- Focus: Electrical, mechanical, HVAC for data centers
2026 Outlook
2026 EPS consensus: $27.41 (+8.6% YoY) on 5.7% revenue expansion. RPO momentum expected to remain supported by data centers, healthcare, manufacturing, and infrastructure investment. Continued improvement in US Building Services segment, combined with disciplined portfolio actions, positions EMCOR for steadier margins and improved earnings visibility.
๐ 2026 Infrastructure Sector Outlook
BlackRock, Goldman Sachs, Deutsche Bank all pick Infrastructure for AI buildout!
Key 2026 Catalysts
- Peak Construction Phase – 2024-2025 announced mega-campuses breaking ground
- AI Cluster Power Density – 50-100 kW per rack (vs 5-15 kW traditional)
- Liquid Cooling REQUIRED – Next-gen AI workloads demand DLC solutions
- Grid Modernization First – Before data centers can break ground
- Hyperscaler Capex – $400B+ from Magnificent 7 alone
- “Gigawatt Campus” Era – Projects too large for regional contractors
Key Statistics
- Data Center Capex: $1+ trillion by 2029 (21% CAGR)
- Hyperscaler Spending: Microsoft $80B, Google $75B, Meta $60B in 2025
- Vertiv 3-Year Return: +1,100% (NVIDIA-comparable!)
- Data Center Power Demand: +165% by 2030 (Goldman Sachs)
- Cooling Market CAGR: ~12% through 2035
๐ Infrastructure Value Chain
The AI infrastructure buildout creates opportunities across the entire value chain:
- Cooling & Power (VRT) – Thermal management, UPS, power distribution
- Grid Modernization (MTZ, PWR) – Transmission, substations, generation
- Site Development (STRL) – Data center site prep, manufacturing facilities
- Inside the Building (EME) – Electrical, mechanical, HVAC systems
- Supporting Players – Caterpillar (backup generators), Schneider Electric (power distribution)
โ ๏ธ Investment Risks
- Valuation: Premium multiples reflect high expectations
- AI Capex Timing: Delays in hyperscaler spending could impact orders
- Labor Constraints: Skilled workforce shortages may limit capacity
- Project Execution: Complex projects carry execution risk
- Interest Rates: Higher rates could slow infrastructure investment
This article is for informational purposes only and does not constitute investment advice. Infrastructure stocks carry risks including project execution, labor constraints, and market cyclicality. Past performance does not guarantee future results. Do your own research before making investment decisions.