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A 100-Year-Old Winner Hiding In Plain Sight
$625 billion.
That’s how much just the top four hyperscalers – Alphabet (NYSE: GOOG), Amazon (AMZN), Meta Platforms (META), and Microsoft (MSFT) – have committed to spend on AI infrastructure in 2026 alone.
If that number doesn’t quite land, consider this: it’s greater than the gross domestic product (“GDP”) of 168 countries. Spent on data centers. In a single year. And that number may ultimately prove to be conservative.
Just 12 months ago, that figure would have seemed laughable. In early 2025, Wall Street analysts were penciling in around $375 billion for the four hyperscalers’ combined annual capital expenditures – a number that already felt shocking. That number grew to $500 billion by year end. But the recent quarterly-earnings cycle brought another round of new records.
Alphabet doubled its 2026 AI capex guidance to $185 billion. Amazon, not to be outdone, announced a massive $200 billion in AI spending – and its stock promptly fell 9%, as if the market couldn’t quite decide whether it was impressed or terrified. Microsoft added $135 billion. Meta pledged “only” $105 billion. In a December research report, Goldman Sachs noted – almost as an aside – that to match the late 1990s telecom investment boom as a percentage of GDP, AI capex would need to hit $700 billion. We could potentially exceed that figure this year.
The AI arms race is real, and the spending is accelerating. These aren’t just projections on a whiteboard. The concrete is being poured. The steel is going up. The facilities are being built – right now – across Wisconsin, Louisiana, Arizona, Virginia, and a dozen other states, on campuses that dwarf anything the tech industry has ever attempted.
So where does all this money go?
Yes, it’s going to all the obvious “AI winners,” but it’s also powering a more mundane business in a big way – and we’ll dig into that business below.
The clear beneficiaries have long been identified, analyzed to death in the financial media, and priced accordingly… getting more expensive every week.
Many of these are good businesses. We’ve even previously recommended some of them – ASML (ASML), ARM Holdings (ARM), Taiwan Semiconductor Manufacturing (TSM), and Vertiv Holdings (VRT), among others – and still have Nvidia (Nasdaq: NVDA) in our portfolio today.
But there’s a problem with trying to own the consensus picks in a gold rush: you tend to have to pay gold-rush prices. The average AI-adjacent semiconductor or infrastructure stock trades at valuations that assume years of flawless execution and zero spending rationalization. If even one hyperscaler stumbles – and Amazon’s 9% post-announcement stock drop suggests the market has its doubts – the high-fliers have a long way to fall.
Meanwhile, there are beneficiaries of this spending that aren’t getting the same kind of attention… or trading at the same lofty valuations.
As we explained last month, some of our current favorites are energy companies. In fact, we just added a new energy recommendation to the Complete Investor portfolio last week.
(If you aren’t already a Complete Investor subscriber, click here to get access to that report.)
However, we’ve also identified a world-class company that provides a critical input into the AI capex boom that most investors have never considered.
You see, every data center – every gigawatt-scale AI campus, every server farm, every cooling tower and power substation – requires something integral before the first high-powered GPU chip gets racked, the first networking cable gets pulled, or the first electron flows. Something so fundamental, so unglamorous, and so taken-for-granted that it doesn’t appear in a single Wall Street “AI beneficiary” report we’ve seen.
And the company that dominates the supply of this essential input – with a 100-year operating history, $1.7 billion in annual free cash flow, and the heaviest insider buying we’ve seen from a sitting CEO in recent memory – trades at a steep discount to its closest peer.
This company’s CEO left the corner office of a $66 billion global enterprise to run it. He then put $77.5 million of his own money into buying shares on the open market at progressively higher prices. His CTO and his directors bought shares, too. And not a single insider has sold.
The stock isn’t in the S&P 500. It isn’t even in the larger Russell 1000 index. Most investment managers – let alone, “mom and pop” investors – have never heard of it. And that is exactly the opportunity.
The $625 Billion Foundation
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