AI Boom Needs Vertiv Almost as Much as It Needs Nvidia
Artificial intelligence requires more than chips; it needs data centers equipped by manufacturers. Investors have taken notice.
Data centers are the refineries for the new oil.
Photographer: Nathan Howard/Bloomberg
The artificial intelligence craze has driven Nvidia Corp. to a $2.3 trillion market value from about $360 billion at the beginning of last year, which means the chipmaker is trading at a price that’s 75 times higher than earnings. It is also taking some industrial companies along for the ride with a lot of room to run.
Astute investors figured out that the huge demand for everything AI will require the handling of an unimaginable amount of data that will be stored and processed at data centers. This is where the opportunities for industrials come into play. Every company that supplies something — anything — for data centers is riding the coattails of Nvidia and is being scooped up by investors.