This AI rally has quickly turned into a data center rally, where you won’t find anything for a sensible price. But that’s only if you ignore this stock. Before we reveal it, it’s a good idea to look at what other “pick and shovel” options you have and the price you have to pay for them.
These pick and shovel stocks either have to do with wiring, cooling, or other nitty-gritty items in a data center. Corning (NYSE:GLW) sells fiber optics to data centers, and it is up over 300% in the past year. Ciena (NYSE:CIEN) sells networking hardware and is up 766% in the past year. The easy money has almost certainly been made. You are paying 52 times forward earnings for GLW stock and 82 times forward earnings for CIEN stock.
Amphenol (NYSE:APH) gets you something similar for just 34 times forward earnings, and this makes me believe the bulk of the gains are still ahead. Let’s dig into what this business is about and why I’ll buy it with my eyes closed.
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