What are the best data center power stocks for investors right now?
Seeking Alpha analysts Manika Premsingh of Long Term Tips and Kody’s Dividends give us their picks.
Manika Premsingh: Big projected AI data center energy demand has catalyzed and can continue to catalyze nuclear energy-producing companies in particular.
Not only are technological advancements underway in the segment, but hyperscalers have already signed agreements with multiple power producers. The segment has also received exceptional support from the U.S. government. Besides a target of tripling nuclear power generation, uranium, a key raw material for the energy source, was included in the critical minerals list issued last year.
Part-nuclear energy producers like Constellation Energy Group (CEG), Duke Energy (DUK), and Vistra (VST) can all make for good buys now, especially for long-term investors.
Kody’s Dividends: In my view, the most sustainable way to play the surging data center electricity demand includes two distinct but complementary sectors: regulated utilities and midstream infrastructure.
The macro tailwinds are undeniable. Goldman Sachs recently forecasted that U.S. data center electricity consumption will soar by 165%, rising from around 4% of total electricity consumption in 2023 to 10% in 2030. This massive jump from around 200 TWh to 500 TWh is creating a reliability gap that only a few companies are equipped to bridge.
In the midstream space, Energy Transfer (ET) is arguably the most aggressive play on this trend. As of early 2026, ET has transitioned from prospecting to commercial execution, signing long-term contracts for over 6B cubic feet per day of pipeline capacity in the past year and receiving connection requests for over 40 data center projects. The 7.2% yield is highly secure with a 1.8x coverage ratio in 2025. At a sub-$19 unit price, ET is also trading moderately below my fair value per unit estimate of nearly $23.
In the regulated utility space, I believe the most compelling value is Xcel Energy (XEL). Its $81 share price trades at a modest discount to my $84 fair value estimate (20x forward 12-month ongoing diluted EPS).
The explosion of demand from AI and data center infrastructure in Xcel’s service territories is why the regulated utility is planning a $60B base capital investment plan for 2026 through 2030 (up from $45B for 2025 through 2029), along with a $10B and counting pipeline. This is expected to drive 9% annual ongoing diluted EPS growth for the company over the next several years. The nearly 3% dividend yield is also secure, which overall paves the way to 10%+ annual total returns.