Every Hyperscaler Raised Capex Again. These 3 Boring Industrials Get Paid No Matter Who Wins the AI Race.
You don't need to guess which big tech company will come out on top.
Overview
There's a lot of pressure on big tech stocks, particularly as they continue to ramp up capital expenditures (capex) to build data centers and acquire networking equipment and processors to run generative and agentic AI programs. Alphabet raised its capex forecast from $185 billion to $200 billion; Amazon jumped from $200 billion to $220 billion; and Meta Platforms is issuing new debt to fund its AI ambitions.
Investors have taken to punishing big tech companies that are spending money without showing results -- I call it the "show me" phase of AI. And although it may be difficult for investors to pick and choose which tech company will delight and which will disappoint in the next earnings report, a safer bet may be to invest in the industrial companies that are putting in the dirty work to make AI function.
Details
Caterpillar (NYSE: CAT), Eaton (NYSE: ETN), and Vertiv Holdings (NYSE: VRT) are three such industrial stocks that fit the bill.
Source
Originally published at www.fool.com.