AI-Powered Stocks Gain Traction Amid Industry Boom

The AI data center industry is booming due to extremely bullish demand from various sectors. To profit from this trend, investors can look at three stocks from the heavy construction and engineering industries: EMCOR Group Inc. (EME), Quanta Services Inc. (PWR), and Caterpillar Inc. (CAT). Each of these companies has a Zacks Rank #1 (Strong Buy) and has rallied more than 19% year-to-date.

However, in the past month, these stocks have provided negative returns. They are also trading at a significant discount to their 52-week high prices. Despite this short-term softness, analysts believe that these stocks have solid short-term price upside potential and robust long-term growth prospects.

EMCOR Group Inc., for example, is a leading provider of critical infrastructure to AI-powered data centers. The company's expected revenue and earnings growth rates are 19.6% and 27.5%, respectively, for the current year. Its RPOs (remaining performance obligations) reached a record $17.14 billion as of June 30, 2026.

Quanta Services Inc., on the other hand, is well-positioned to capitalize on robust infrastructure spending across utility, power generation, technology, and load center markets. The company's acquisition strategy is creating another growth avenue while complementing organic opportunities. Its total backlog reached a record $53.4 billion as of June 30, 2026.

Caterpillar Inc. is gaining from rising AI data-center-related power demand. The company expects full-year 2026 power generation growth in both reciprocating engines and Solar Turbines. Its long-term plan calls for large reciprocating engine capacity nearly three times the 2024 levels by 2030.