Arrakis Global
Global Thematic Fund Manager
Nexans' huge leverage to European grid spending makes its shares look too cheap for a company of its quality. The stock trades at roughly 13x consensus 2027 earnings and sold off with data-center infrastructure stocks despite AI accounting for under 5% of revenue. Management guides to positive single-digit growth into 2027, with large-project tendering picking up in the second half of 2027 through 2028. x.com x.comÂ
Dycom looks compelling because its infrastructure backlog and operating execution position it to benefit from AI's demand for power, fiber, and data centers. Its backlog has grown to $12.2 billion from $8 billion a year ago, Building Systems EBITDA margins exceed 20%, and Power Solutions is running 30% ahead of acquisition expectations. The long-term growth opportunity may be underappreciated as the market focuses on near-term margin pressure. x.comÂ
EnerSys looks mispriced at about 15x forward earnings versus 23-31x for electrical equipment peers like nVent, Eaton and Hubbell riding the same AI power demand. It has beaten earnings 10 straight times, generated about $717M of free cash flow in 12 months, a near 10% yield, and lifted gross margin over 500 bps to 33.5%. Data center orders rose over 80% and defense revenue 24%. A third of adjusted earnings comes from a US tax credit that phases down after 2030; forklift batteries remain soft. … Show more
Forgent Power Solutions is the highest-upside energy infrastructure stock, a picks-and-shovels play on expanding and upgrading the electrical grid that could be worth $60+ versus about $38 today. @TrackNetWorth counters that grid connection delays will cap the upside before it reaches that target. x.com x.comÂ
GE Vernova is poised to make massive profits because energy is the key bottleneck for the hyperscalers it supplies. Its EPS numbers are huge, and MarketSurge charts recently flagged a buy signal. x.comÂ
Solaris Energy Infrastructure is a very cheap way to play the US power build-out, now expanding to 3.1GW on booming demand from customers like xAI. Two deals add 900 MW of turbines: 400 MW via the Genco Power acquisition and about 500 MW of turbine delivery slots. The $1.55B cost, about $1.73M per MW, is well above prior purchases, but the company sees clear line of sight to deploy. Stifel estimates the added 900 MW could lift 2028 EBITDA about $300M above the $760M expected, about $15 a share. … Show more
Itron is priced like a cyclical hardware vendor while becoming a software platform, a gap that closes once the market values its Grid Edge Intelligence as software infrastructure. Its network spans 100 million endpoints, and replacing it is a multi-year project for a utility. Recurring revenue is $368M, up 20%, and Q1 gross margin rose from 35.8% to 40.7% as legacy contracts rolled off. At 13x earnings the issue is catalysts, not price; lumpy orders and weak Q2 guidance may delay a rerating. … Show more
