Morgan Stanley Identifies 12 AI Infrastructure Stocks with 40%+ Upside Potential

The AI infrastructure investment theme remains compelling, according to Morgan Stanley. While the firm suggests beginning to accumulate AI adopter and software positions ahead of the next leg of AI-driven gains, analysts advised clients in a September 24 note to maintain holdings in companies central to the data center power constraint. “We anticipate compute demand will substantially outstrip supply for years ahead,” wrote a team headed by Stephen Byrd. Morgan Stanley cites several headwinds impeding expansion: constrained electricity availability, scarcity of skilled labor for data center construction, and regulatory hurdles. In prior technology cycles, infrastructure plays typically lag once attention shifts to adoption beneficiaries. However, persistent buildout constraints coupled with robust demand should sustain this trade’s momentum, the bank argues. “We don’t foresee the same sequential leadership rotation observed in earlier computing cycles. Rather, we project a ‘barbell’ pattern of outperformance over the coming 6-12 months” spanning both adopters and AI picks-and-shovels names, the firm stated. To capitalize on the opportunity, Morgan Stanley outlined AI power bottleneck equities carrying “Overweight” ratings (equivalent to Buy). Below are the 12 U.S.-listed names on that list offering at least 40% upside to the firm’s price targets. NextEra Energy Ticker: NEE Industry: Renewable Energy Developers / IPPs Price target: $111.00 Upside to price target: 40.0% GE Vernova Cummins Williams Companies Ticker: WMB Industry: Midstream Energy Price target: $103.00 Upside to price target: 45.1% Liberty Energy Riot Platforms Ticker: RIOT Industry: Powered Shell Providers (PSPs) Price target: $43.00 Upside to price target: 72.5% Erock Clearway Ticker: CWEN Industry: Renewable Energy Developers / IPPs Price target: $58.00 Upside to price target: 89.2% INNIO Group Hut 8 Ticker: HUT Industry: Powered Shell Providers (PSPs) Price target: $273.00 Upside to price target: 156.1% Cipher Mining Ticker: CIFR Industry: Powered Shell Providers (PSPs) Price target: $54.00 Upside to price target: 182.9% Terawulf Ticker: WULF Industry: Powered Shell Providers (PSPs) Price target: $62.50 Upside to price target: 260.6%