US industrial and electrical equipment stocks are suddenly in the spotlight as data centre projects face potential moratoriums, communities push back on new builds, and transformer shortages expose how reliant the US is on imports. At the same time, foreign groups such as Hitachi and Siemens are committing fresh capital to US manufacturing, and China is reportedly lining up a $295b data centre buildout of its own. For investors, this mix of risk and new investment could reshape which US electrical makers are better placed. This article walks through 3 stocks exposed to these headlines.

Shoals Technologies Group (SHLS)

Overview: Shoals Technologies Group designs and manufactures electrical balance of system components that sit behind large solar panels and battery storage units, providing the wiring, junction boxes, monitoring and battery energy storage solutions that allow utility scale solar farms and data heavy facilities to connect safely and efficiently to the grid.

Operations: Shoals generates about US$535.5m in revenue from electric equipment solutions sold into solar and battery storage projects.

Market Cap: US$1.7b

Investors looking at the US energy and data centre build out may find Shoals Technologies Group worth a closer look, as it supplies EBOS and battery energy storage solutions that sit at the heart of power hungry AI and data infrastructure. Recent news around a potential US ban on Chinese inverters and its ITC patent win underline how important domestic, IP protected suppliers could become. A record backlog and strong recent revenue growth show healthy demand, even as earnings quality is clouded by legal and warranty costs plus a high P/E. The key issue for investors is whether Shoals can turn that strong order book and new BESS and data centre opportunities into durable, higher quality cash flows.

Shoals Technologies Group sits at the center of surging grid and data power demand, yet its legal and warranty noise could be masking the real story behind its cash generation and margins. Get the full picture with the analysis report for Shoals Technologies Group

AAON (AAON)

Overview: AAON designs and manufactures high efficiency heating, ventilation and air conditioning systems, including specialized cooling and cleanroom solutions that serve commercial buildings, data centres, healthcare facilities and other mission critical sites across the US and Canada.

Operations: AAON generates about US$972.2m in revenue from its Oklahoma operations, US$385.1m from the BASX segment, and US$368.2m from AAON Coil Products, partly offset by US$108.6m of intersegment eliminations.

Market Cap: US$8.8b

AAON is tightly plugged into the data centre build out, with its BASX division supplying advanced air and liquid cooling systems that sit at the core of AI heavy facilities, underpinning a record US$2.13b backlog and raised 2026 revenue guidance of 40 to 45%. At the same time, investors have to weigh a very high P/E multiple, pressure on margins and cash flow from ERP rollouts, capacity expansions and debt funding, plus insider selling that has raised some questions about sentiment. For anyone tracking US industrial and electrical equipment stocks, the real interest in AAON is whether its data centre cooling pipeline and efficiency gains can offset those profitability and funding risks over the next few years.

AAON’s data centre cooling story is accelerating, but the real tension is how that growth stacks up against its rich P/E, ERP and funding pressures. Get the fuller risk reward picture in the 3 key rewards and 5 important warning signs (2 are major!)

Sensata Technologies Holding (ST)

Overview: Sensata Technologies Holding supplies sensors, electrical protection devices, power conversion systems and related components that sit inside mission critical equipment ranging from cars and trucks to aircraft, industrial machinery, data centres and charging infrastructure across global markets.

Operations: Sensata generates about US$2.1b in revenue from Automotive customers, US$834.1m from Aerospace, Defense, and Commercial Equipment, and US$786.3m from Industrials.

Market Cap: US$6.6b

Sensata Technologies Holding gives you exposure to electrification and data centre buildouts through the “plumbing” that keeps high power systems safe and running, including contactors, circuit protection and thermal sensors that already sit inside and outside many data centres. Forecast earnings growth of roughly 27.1% per year, a growing buyback program and a rising dividend are cited as signals of management’s confidence, while recent product launches such as the A+P PyroFuse target higher value, safety critical applications. The flip side is a very high current P/E, modest revenue growth expectations, high leverage and a history of earnings volatility after a large write down. The key question for investors is whether Sensata’s push into higher margin industrial, aerospace and data centre niches can justify that richer valuation over time.

Sensata’s push into higher margin electrification and data centre niches, alongside buybacks and a rising dividend, signals a story investors may not have fully priced in yet. The analyst forecasts for Sensata Technologies Holding might reveal why that confidence could be more fragile than it looks.

The three US industrial and electrical equipment stocks in this article are just a starting point. The full US Industrial and Electrical Equipment Manufacturing screener surfaces 33 more companies that share similar scale, financial profiles and sector exposure. Use Simply Wall St to identify and analyze the specific catalysts and narratives that matter to you so you can focus on the highest conviction plays in this corner of the market.

Take Control of Your Investment Journey

If AAON or any of these companies sound like a great opportunity, register for FREE with Simply Wall St and add your companies to a Watchlist to monitor the share price against the fair value the ideal entry point. Once you've made your move, manage your holdings with our Portfolio Command Center that filters out the noise to deliver only the most critical, actionable updates. Throughout your journey, our Community allows you to filter the best ideas from thousands of investor perspectives. By uncovering hidden catalysts and risks early, you'll accelerate your decision-making and stay one step ahead of the market.

Curious About Seeking Fresh Alternatives?

Fresh stock ideas move fast, and the best entry points often appear just as momentum is building and before the crowd catches on, so act now.

• Spot early movers in smaller companies that already show solid balance sheets using the curated list of solid balance sheet and fundamentals (47 results) before the rest of the market catches up.
• Ride powerful trends in computing by scanning the hand picked 26 quantum computing stocks that connect real revenues to emerging technology before sentiment starts flying.
• Target resilient income opportunities through a focused 7 dividend fortresses built for investors who want yield that aims to hold up when sentiment drops.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.