As global yields react to softer US jobs data, investors are watching how lower rate expectations can support long term projects that underpin AI. Cheaper capital often benefits the heavy infrastructure that AI infrastructure stocks rely on. This article looks at three AI infrastructure stocks from our screener that sit at the heart of this physical build out, and explains how they fit into today’s rate focused market.

The three stocks covered below are just a starter set. The full AI infrastructure screen surfaced 53 more companies with equally compelling stories that are not included in this article. To identify and analyze your own highest conviction angles on this theme, head straight into the AI Infrastructure Stocks screener.

Celestica (TSX:CLS)

Overview: Celestica is a Toronto based manufacturing and supply chain specialist that designs, builds, and manages complex hardware platforms and electronics for customers such as original equipment makers, cloud providers and hyperscalers across sectors including communications, cloud, aerospace and defense, industrial, and HealthTech.

Operations: Celestica generates most of its revenue from Connectivity & Cloud Solutions at about US$12.3b, with Advanced Technology Solutions contributing roughly US$3.3b.

Market Cap: CA$51.0b

Investors watching AI infrastructure should pay close attention to Celestica, which sits inside the build out of advanced networking and rack scale AI platforms such as its Helios collaboration with AMD. The company is currently experiencing strong hyperscaler demand, a higher margin mix in areas such as aerospace and HealthTech, and rising ROE alongside expanding profit margins. At the same time, heavy reliance on a handful of large cloud customers and the funding mix leaning on external borrowing create downside risk if orders slow or program ramps slip. Recent equity raises to support capacity and higher analyst targets show how much is now expected, making the balance between growth and execution risk the key story to watch.

Celestica’s accelerating hyperscaler pipeline and higher margin mix are only half the story. The real question is whether that momentum justifies the expectations now priced in. Get the full picture in the 4 key rewards and 2 important warning signs (1 is major!)

Build your own AI infrastructure shortlist

Celestica and the two other AI infrastructure stocks in this article all came out of the same screener, but your best ideas will come from filters tailored to you. Use our customisable Screener to mix valuation, growth, balance sheet and risk metrics into your own watchlist, or tap into our curated Investing Ideas for ready made themes to research next.

Jabil (JBL)

Overview: Jabil is a Florida based manufacturing and engineering company that designs, builds, and manages complex electronic hardware and embedded software for customers across industries including 5G, cloud data centers, healthcare, automotive, industrial equipment, and consumer devices.

Operations: Jabil generates about US$12.4b of revenue from Regulated Industries, US$15.8b from Intelligent Infrastructure, and US$5.4b from Connected Living and Digital Commerce.

Market Cap: US$35.8b

Jabil sits inside the AI infrastructure build out, with its Intelligent Infrastructure segment supplying cloud data center platforms. Its recent India expansion and Adani partnership are aimed at multi gigawatt AI rack capacity. Analysts report strong earnings and revenue growth, and ROE is described as very high, but that performance is tied to significant leverage and a P/E that already prices in a lot of success. Recent weakness in renewable energy, EV and consumer focused segments, along with tariff uncertainty and slightly stretched inventory, illustrates how quickly sentiment could change if demand cools. For investors, the tension between powerful AI driven demand on one side, and balance sheet and execution risk on the other, is what makes Jabil a candidate for closer consideration.

Jabil’s AI rack ambitions and very high ROE are only part of the story. The real puzzle is how its leverage and P/E shape the risk reward trade off. Get the full context in the 4 key rewards and 1 important warning sign

Vertiv Holdings Co (VRT)

Overview: Vertiv Holdings Co supplies the power, cooling, and thermal management systems that keep AI heavy data centers, telecom networks, and other mission critical infrastructure running across more than 100 countries.

Operations: Vertiv generates about $7.5b of revenue from the Americas, $2.7b from Asia Pacific, and $2.4b from Europe, the Middle East & Africa, partly offset by $1.2b of intersegment sales.

Market Cap: $104.9b

Vertiv sits at the center of the AI infrastructure build out, supplying liquid cooling and high density power systems that are increasingly required as GPU racks consume 100 kilowatts or more each. Rising margins, a high ROE of 36.4%, and a multi billion dollar backlog have drawn attention, alongside new facilities in Malaysia and Italy and acquisitions that deepen its liquid cooling capabilities. At the same time, the stock trades on a rich P/E, depends heavily on a small group of hyperscale customers, and uses higher risk external borrowing, which can magnify any slowdown or execution hiccup. That mix of powerful AI demand and elevated expectations is what makes Vertiv a candidate for closer research.

Vertiv’s accelerating AI power and cooling story is impressive, yet the mix of high ROE, rich P/E, and hyperscaler dependence raises a sharper question. See how those pieces really fit together in the analysis report for Vertiv Holdings Co

Seeking Alternatives Before The Crowd?

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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.