10 Best Data Centers for February 2026
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Market Overview & Selection Criteria
The stock market continues to show strength in technology and infrastructure sectors, particularly data centers and cloud computing, driven by AI demand and digital transformation. ValueSense selected these 10 best stock picks using intrinsic value analysis, focusing on companies with Quality ratings above 5.0, strong revenue growth, and potential undervaluation based on intrinsic value estimates compared to market positioning. Criteria emphasize ROIC, FCF margins, debt levels, and 1Y returns to highlight undervalued stocks to buy across tech, networking, and services. This stock watchlist prioritizes diversified investment opportunities in high-growth areas like data centers.
Featured Stock Analysis
Stock #1: Oracle Corporation (ORCL)
| Metric | Value |
|---|---|
| Market Cap | $474.9B |
| Quality Rating | 6.1 |
| Intrinsic Value | $160.5 |
| 1Y Return | -3.4% |
| Revenue | $61.0B |
| Free Cash Flow | ($13.2B) |
| Revenue Growth | 11.1% |
| FCF margin | (21.6%) |
| Gross margin | 78.0% |
| ROIC | 13.1% |
| Total Debt to Equity | 408.4% |
Investment Thesis
Oracle Corporation (ORCL) stands out in the enterprise software space with a massive $474.9B market cap and robust 78.0% gross margin, reflecting strong pricing power in cloud and database solutions. Despite a negative 1Y Return of -3.4% and negative Free Cash Flow of $13.2B with 21.6% FCF margin, the company's 11.1% revenue growth to $61.0B and 13.1% ROIC indicate operational efficiency. ValueSense Quality rating of 6.1 and intrinsic value of $160.5 suggest potential upside for value-oriented analysis in data center ecosystems.
High Total Debt to Equity at 408.4% warrants caution, but Oracle's scale positions it well for long-term cloud migration trends. This analysis frames ORCL as an educational case for balancing growth with financial leverage in ORCL analysis.
Key Catalysts
- 11.1% revenue growth signaling sustained demand for cloud services
- 78.0% gross margin supporting profitability in competitive tech landscape
- 13.1% ROIC demonstrating efficient capital use
Risk Factors
- Negative $13.2B Free Cash Flow and 21.6% FCF margin due to investments
- Elevated 408.4% Total Debt to Equity increasing financial vulnerability
- Lagging -3.4% 1Y Return amid market rotations
Stock #2: Arista Networks, Inc. (ANET)
| Metric | Value |
|---|---|
| Market Cap | $181.1B |
| Quality Rating | 7.9 |
| Intrinsic Value | $63.9 |
| 1Y Return | 24.5% |
| Revenue | $8,448.3M |
| Free Cash Flow | $4,046.0M |
| Revenue Growth | 27.8% |
| FCF margin | 47.9% |
| Gross margin | 64.3% |
| ROIC | 76.6% |
| Total Debt to Equity | 0.0% |
Investment Thesis
Arista Networks (ANET), with a $181.1B market cap, excels in networking for data centers, boasting a top 7.9 Quality rating and exceptional 76.6% ROIC. Positive $4,046.0M Free Cash Flow at 47.9% FCF margin and 27.8% revenue growth to $8,448.3M underscore operational strength, complemented by 64.3% gross margin and zero Total Debt to Equity at 0.0%. The 24.5% 1Y Return and intrinsic value of $63.9 highlight it as a standout in ANET analysis for high-quality growth.
This positions ANET as a prime example of debt-free scalability in AI-driven networking demands.
Key Catalysts
- 27.8% revenue growth fueled by data center expansion
- 47.9% FCF margin and $4,046.0M FCF for reinvestment
- 76.6% ROIC indicating superior returns on capital
Risk Factors
- Intrinsic value $63.9 potentially signaling valuation stretch
- Dependence on tech sector cycles
- Competition in high-speed networking
Stock #3: Vertiv Holdings Co (VRT)
| Metric | Value |
|---|---|
| Market Cap | $72.7B |
| Quality Rating | 7.7 |
| Intrinsic Value | $43.3 |
| 1Y Return | 62.5% |
| Revenue | $9,696.3M |
| Free Cash Flow | $1,372.7M |
| Revenue Growth | 28.8% |
| FCF margin | 14.2% |
| Gross margin | 34.7% |
| ROIC | 20.7% |
| Total Debt to Equity | 7.2% |
Investment Thesis
Vertiv Holdings Co (VRT) supports data center infrastructure with $72.7B market cap, 7.7 Quality rating, and impressive 62.5% 1Y Return. 28.8% revenue growth to $9,696.3M, positive $1,372.7M FCF at 14.2% margin, 34.7% gross margin, and 20.7% ROIC reflect momentum, though intrinsic value of $43.3 suggests scrutiny. Low 7.2% Total Debt to Equity adds stability to this VRT analysis.
VRT exemplifies cooling and power solutions critical for data center scaling.
Key Catalysts
- 62.5% 1Y Return from infrastructure demand
- 28.8% revenue growth aligning with AI buildout
- 20.7% ROIC for efficient expansion
Risk Factors
- Intrinsic value $43.3 vs. growth pricing
- 14.2% FCF margin moderate amid capex
- Supply chain vulnerabilities
Stock #4: Quanta Services, Inc. (PWR)
| Metric | Value |
|---|---|
| Market Cap | $70.7B |
| Quality Rating | 6.0 |
| Intrinsic Value | $288.7 |
| 1Y Return | 53.5% |
| Revenue | $27.2B |
| Free Cash Flow | $830.8M |
| Revenue Growth | 18.7% |
| FCF margin | 3.1% |
| Gross margin | 14.3% |
| ROIC | 7.3% |
| Total Debt to Equity | 5.8% |
Investment Thesis
Quanta Services (PWR) provides essential services for data centers and energy with $70.7B market cap and 53.5% 1Y Return. 6.0 Quality rating, 18.7% revenue growth to $27.2B, $830.8M FCF at 3.1% margin, 14.3% gross margin, 7.3% ROIC, and low 5.8% Total Debt to Equity offer a balanced profile. Intrinsic value of $288.7 points to undervaluation in PWR analysis.
PWR's role in infrastructure buildout supports long-term stock picks themes.
Key Catalysts
- 53.5% 1Y Return from project backlogs
- 18.7% revenue growth in electrification
- Low 5.8% debt enabling flexibility
Risk Factors
- Thin 3.1% FCF margin pressuring cash generation
- 14.3% gross margin sensitive to costs
- Project execution risks
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Stock #5: NetApp, Inc. (NTAP)
| Metric | Value |
|---|---|
| Market Cap | $19.5B |
| Quality Rating | 6.9 |
| Intrinsic Value | $133.9 |
| 1Y Return | -21.3% |
| Revenue | $6,635.0M |
| Free Cash Flow | $1,598.0M |
| Revenue Growth | 2.5% |
| FCF margin | 24.1% |
| Gross margin | 70.3% |
| ROIC | 29.8% |
| Total Debt to Equity | 252.1% |
Investment Thesis
NetApp (NTAP) focuses on data storage with $19.5B market cap, 6.9 Quality rating, and strong $1,598.0M FCF at 24.1% margin. Despite -21.3% 1Y Return, 2.5% revenue growth to $6,635.0M, 70.3% gross margin, and 29.8% ROIC shine, offset by 252.1% Total Debt to Equity. Intrinsic value $133.9 supports recovery potential in NTAP analysis.
Ideal for storage needs in expanding data ecosystems.
Key Catalysts
- 24.1% FCF margin bolstering balance sheet
- 70.3% gross margin and 29.8% ROIC
- Data management demand
Risk Factors
- -21.3% 1Y Return indicating underperformance
- High 252.1% debt ratio
- Slow 2.5% revenue growth
Stock #6: IonQ, Inc. (IONQ)
| Metric | Value |
|---|---|
| Market Cap | $12.0B |
| Quality Rating | 6.1 |
| Intrinsic Value | $5.1 |
| 1Y Return | 3.0% |
| Revenue | $79.8M |
| Free Cash Flow | ($201.7M) |
| Revenue Growth | 113.1% |
| FCF margin | (252.6%) |
| Gross margin | 35.1% |
| ROIC | (27.1%) |
| Total Debt to Equity | 2.1% |
Investment Thesis
IonQ (IONQ), a quantum computing player, has $12.0B market cap and 6.1 Quality rating. Explosive 113.1% revenue growth to $79.8M contrasts with $201.7M FCF at 252.6% margin, 35.1% gross margin, negative 27.1% ROIC, and low 2.1% debt. 3.0% 1Y Return and $5.1 intrinsic value frame high-risk/high-reward in IONQ analysis.
Emerging tech exposure for speculative portfolios.
Key Catalysts
- 113.1% revenue growth in quantum tech
- Low 2.1% debt for agility
- Innovation pipeline
Risk Factors
- Severe 252.6% FCF margin and negative ROIC
- Early-stage revenue $79.8M
- Valuation vs. $5.1 intrinsic
Stock #7: Crown Holdings, Inc. (CCK)
| Metric | Value |
|---|---|
| Market Cap | $11.9B |
| Quality Rating | 6.3 |
| Intrinsic Value | $62.9 |
| 1Y Return | 18.1% |
| Revenue | $12.1B |
| Free Cash Flow | $1,008.0M |
| Revenue Growth | 3.1% |
| FCF margin | 8.3% |
| Gross margin | 19.5% |
| ROIC | 13.4% |
| Total Debt to Equity | 185.5% |
Investment Thesis
Crown Holdings (CCK) in packaging has $11.9B market cap, 6.3 Quality rating, 18.1% 1Y Return, and $1,008.0M FCF at 8.3% margin. 3.1% revenue growth to $12.1B, 19.5% gross margin, 13.4% ROIC, but 185.5% debt. Intrinsic $62.9 aids CCK analysis for industrial ties.
Supports supply chain for tech hardware.
Key Catalysts
- Positive $1,008.0M FCF and 18.1% 1Y Return
- 13.4% ROIC efficiency
- Steady 3.1% growth
Risk Factors
- 185.5% debt burden
- Low 19.5% gross margin
- Commodity exposure
Stock #8: KT Corporation (KT)
| Metric | Value |
|---|---|
| Market Cap | $10.1B |
| Quality Rating | 5.4 |
| Intrinsic Value | $33.2 |
| 1Y Return | 18.9% |
| Revenue | â©28.0T |
| Free Cash Flow | â©695.1B |
| Revenue Growth | 5.4% |
| FCF margin | 2.5% |
| Gross margin | 51.9% |
| ROIC | 6.3% |
| Total Debt to Equity | 58.4% |
Investment Thesis
KT Corporation (KT), a telecom with $10.1B market cap and 5.4 Quality rating, shows 18.9% 1Y Return. â©28.0T revenue grew 5.4%, â©695.1B FCF at 2.5% margin, 51.9% gross margin, 6.3% ROIC, 58.4% debt. Intrinsic $33.2 for KT analysis.
Key for connectivity in Asia data growth.
Key Catalysts
- 18.9% 1Y Return momentum
- 51.9% gross margin strength
- Regional expansion
Risk Factors
- Lowest 5.4 Quality rating
- Thin 2.5% FCF margin
- Currency risks
Stock #9: GDS Holdings Limited (GDS)
| Metric | Value |
|---|---|
| Market Cap | $9,920.4M |
| Quality Rating | 6.2 |
| Intrinsic Value | $27.0 |
| 1Y Return | 93.9% |
| Revenue | CN¥11.2B |
| Free Cash Flow | (CN¥766.3M) |
| Revenue Growth | 2.1% |
| FCF margin | (6.8%) |
| Gross margin | 22.8% |
| ROIC | 1.9% |
| Total Debt to Equity | 175.3% |
Investment Thesis
GDS Holdings (GDS), data center operator, $9,920.4M market cap, 6.2 Quality rating, 93.9% 1Y Return. CN¥11.2B revenue up 2.1%, (CN¥766.3M) FCF at 6.8% margin, 22.8% gross margin, 1.9% ROIC, 175.3% debt. Intrinsic $27.0 in GDS analysis.
China exposure for global data trends.
Key Catalysts
- 93.9% 1Y Return surge
- Data center capacity growth
- 2.1% revenue stability
Risk Factors
- Negative FCF and low 1.9% ROIC
- High 175.3% debt
- Geopolitical concerns
Stock #10: Applied Digital Corporation (APLD)
| Metric | Value |
|---|---|
| Market Cap | $9,480.3M |
| Quality Rating | 6.2 |
| Intrinsic Value | $1.1 |
| 1Y Return | 359.1% |
| Revenue | $281.7M |
| Free Cash Flow | ($1,144.1M) |
| Revenue Growth | 33.1% |
| FCF margin | (406.1%) |
| Gross margin | 16.4% |
| ROIC | (5.7%) |
| Total Debt to Equity | 125.9% |
Investment Thesis
Applied Digital (APLD) in digital infrastructure, $9,480.3M market cap, 6.2 Quality rating, explosive 359.1% 1Y Return. 33.1% revenue growth to $281.7M, but $1,144.1M FCF at 406.1% margin, 16.4% gross margin, 5.7% ROIC, 125.9% debt. Intrinsic $1.1 flags risks in APLD analysis.
High-volatility play on HPC/data centers.
Key Catalysts
- 359.1% 1Y Return hype
- 33.1% revenue growth
- AI infrastructure demand
Risk Factors
- Extreme 406.1% FCF margin losses
- Negative 5.7% ROIC
- Low intrinsic $1.1
Portfolio Diversification Insights
These top stocks to buy now cluster in technology (ORCL, ANET, NTAP, IONQ), data center infrastructure (VRT, PWR, GDS, APLD), and supporting sectors (CCK, KT). Allocation: 50% tech core, 30% infrastructure/services, 20% emerging/high-growth. ANET and VRT offer quality anchors (high ROIC/FCF), balanced by ORCL/PWR scale and IONQ/APLD speculation. Low-debt names like ANET/PWR complement leveraged plays (ORCL, GDS), reducing correlation risks while targeting data center themes for best value stocks synergy.
Market Timing & Entry Strategies
Consider positions during sector pullbacks, such as post-earnings dips or when AI hype cools, aligning with positive revenue growth (e.g., ANET 27.8%, VRT 28.8%). Dollar-cost average into high-quality picks like ANET/VRT on 5-10% declines from peaks. Monitor FCF trends for cash-generators (NTAP, CCK) vs. growth bets (IONQ, APLD). Use intrinsic values as educational benchmarks for entry below estimates, focusing on stock watchlist rotation toward improving ROIC.
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FAQ Section
How were these stocks selected?
Selected via ValueSense methodology emphasizing Quality ratings >5.0, revenue growth, ROIC, and intrinsic value for 10 best stock picks in data centers/tech.
What's the best stock from this list?
ANET leads with 7.9 Quality rating, 76.6% ROIC, zero debt, and 47.9% FCF margin, ideal for quality-focused investment opportunities.
Should I buy all these stocks or diversify?
Diversify across tech (ORCL, ANET), infrastructure (VRT, PWR), and emerging (IONQ, APLD) to balance risks in this stock watchlist.
What are the biggest risks with these picks?
Negative FCF in ORCL/IONQ/APLD, high debt (ORCL 408.4%, GDS 175.3%), and growth volatility (APLD -406.1% margin).
When is the best time to invest in these stocks?
Target dips in data center cycles, using intrinsic values (e.g., PWR $288.7, NTAP $133.9) as guides for undervalued stocks to buy.