Business 1 min read By Arthur Ellington
Bernstein names stocks to buy as data centre political risks appear overstated
Bernstein analysts say political concerns over data centres look overstated and have named stocks they consider buys.
Bernstein has named a set of stocks it considers buys, arguing that political risks facing the data centre sector appear to be overstated. The brokerage's view suggests investors may be pricing in more regulatory and political pressure on data centre operators than the current picture warrants.
The recommendation comes at a time when data centres have drawn growing scrutiny over their power consumption and their effect on local infrastructure. Concerns about energy demand and the pace of new construction have prompted debate among policymakers and communities, and some investors have grown wary of the sector as a result.
Bernstein's analysis questions whether those concerns will translate into significant constraints on the companies building and operating the facilities. By naming stocks to buy, the firm signals that it sees potential value in the sector despite the political noise surrounding it.
The note adds to a wider debate in financial markets about how much weight to give political and regulatory risk when valuing companies tied to the expansion of cloud computing and artificial intelligence, both of which depend heavily on data centre capacity.
Source: investing.com
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