My Top AI Power Stock to Buy Right Now (and It's Not Even Close)
2026-09-29 20:30
•Leo Sun •The Motley Fool
••••• ••• Axe Cap view
Why GE Vernova Outshines Nvidia in the AI Infrastructure Race
GE Vernova’s energy focus offers a clearer growth path than flashy chipmakers amid the AI surge.
The AI boom’s spotlight usually falls on chipmakers like Nvidia, but GE Vernova deserves a look beneath the surface. This spun-off energy arm of General Electric feeds the massive electricity demand from AI data centers, and their backlog's up 37% year-on-year to $176 billion. What sets GE Vernova apart is its ability to convert that demand into steady cash flow and margin expansion—free cash flow expected to triple by 2026 with EBITDA margins climbing to 12-14%. Local investors should take note because growth in AI-driven power needs will keep the rand under some pressure as the USD/ZAR could stay elevated, reflecting stronger foreign tech capital demand. For a South African angle, watch companies like Sasol—while it’s not AI-related, Sasol’s energy infrastructure exposure makes it a proxy for industrial and energy transitions that underpin this global tech growth. The big caveat? If AI growth cools or energy tech innovation stumbles, GE Vernova’s premium valuation might get hit harder than semiconductor stocks. this is just our opinion and not financial advice
Buy GE Vernova for steady AI-driven energy growth and trim some South African energy names like Sasol after recent gains, keeping a close eye on USD/ZAR trends reflecting foreign tech flows.
- GE Vernova (GEV)
- Sasol (SOL)
- USD/ZAR
- Slowing global AI investment reducing power demand
- Volatile USD/ZAR impacting local investor returns
7/10
GE Vernova, the spun-off energy division of General Electric, is positioned as a top AI power stock to buy. The company benefits from surging electricity demand at AI data centers, with its backlog growing 37% year-over-year to $176.3 billion. GE Vernova expects 20-22% revenue growth in 2026, with adjusted EBITDA margins expanding to 12-14% and free cash flow projected to triple to $11.5-12.5 billion. Trading at around $960 per share with a 25x forward EBITDA valuation, the stock appears reasonably valued given analysts expect 60% CAGR adjusted EBITDA growth through 2028.
Our take is based on reporting first published by The Motley Fool.