The surge of artificial intelligence (AI) and the resulting boom in new data centers are benefiting several pick-and-shovel stock plays, especially electrical infrastructure companies that both help get data centers up and running and keep them running.
Emcor Group (EME +0.07%), Schneider Electric (SBGSY 0.27%), and Quanta Services (PWR +1.31%) may not be well known outside of their sector, but all three are seeing dependable revenue growth, thanks to the data center build-out.
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1. Emcor: Double-digit growth, big backlog of orders
Emcor, based in Norwalk, Connecticut, focuses on mechanical and electrical construction and facilities services in the United States and the United Kingdom. Data centers require massive cooling systems and complex electrical layouts to handle high-density computing. Emcor's recent guidance hike was largely driven by a record $15.6 billion backlog, up 32.9% year over year, much of which is tied to these high-margin, technically demanding projects.
In the first quarter, Emcor reported record revenue, record earnings per share (EPS), and a record backlog. The company said it had quarterly revenue of $4.63 billion, up 19.7% year over year; EPS of $6.84, up 30% over the same period last year; and a backlog of $15.62 billion, up 32.9% year over year.
NYSE: EME
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The numbers were good enough that Emcor raised its yearly revenue guidance to $18.5 billion to $19.25 billion, up from prior guidance of $17.75 billion to $18.5 billion. It also lifted its yearly EPS estimate to between $28.25 and $29.75, up from a range of $27.25 to $29.25.
Over the last decade, Emcor has used its strong free cash flow to buy back shares, including a recent $500 million buyback pledge, and acquire smaller, specialized firms, effectively growing its EPS even when the broader economy is flat.
2. Schneider is seeing diversified growth by region
Based in France, Schneider is a global powerhouse in energy management and industrial automation. It provides software, circuit-protected devices, and uninterruptible power supply products for the grid. Its Aveva software suite allows companies to monitor energy efficiency in real time.
Schneider has massive exposure to North America, Europe, and Asia. This multi-hub model protects it against regional downturns. In the first quarter, it was doing well in all regions, led by North America, which saw revenue climb by 14.4% on an organic (growth generated from its own internal operations and existing businesses) basis year over year, and by China and East Asia, which reported revenue rising by 14.2% organically over the first quarter of 2025.
OTC: SBGSY
Key Data Points
Overall, revenue rose 4.7%, year over year, to 9.77 billion euros, led by a double-digit increase in demand for data center services. The company reaffirmed its 2026 guidance of 7% to 10% organic revenue growth and an organic increase of 50 to 80 basis points in the adjusted earnings before interest, taxes, and appreciation (EBITA) margin. It has a dividend yield of around 0.89% and has increased its dividend by 163% over the past decade.
3. Quanta Services is becoming a go-to player for data centers
This Houston-based company builds physical transmission lines and substations that connect power plants (and wind/solar farms) to the end user. It reported a record backlog of $39.2 billion in the first quarter as one of the few companies with the scale and specialized labor to handle massive, multi-state transmission projects.
In the first quarter, Quanta reported EPS of $1.45, up 51%, year over year, and revenue of $7.9 billion, up 26% over the same period a year ago. The company has shifted into more manufacturing, making its own power transformers, which allows it to manage its own supply chain.
It also boosted nearly all of its guidance. It said it expects yearly revenue between $34.7 billion and $35.2 billion, up 22.8% at the midpoint, and yearly EPS between $9.17 and $9.87, an increase of 40% at the midpoint.
NYSE: PWR
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One concern to watch
While these stocks aren't household names, investors have noticed their growth. Their shares are up between 18% and 78% so far this year. For that reason, their valuations are relatively high for the electrical infrastructure sector, especially Quanta Services.
I like all three stocks, but among the trio, Emcor's valuation is the most reasonable. In the long term, Quanta Services appears to have the most growth potential. Schneider is also priced reasonably and presents the most diversification of the three, though with slower growth.
