Best Servers & Thermal Stocks to Watch in 2026

The server and thermal management sector stands at the epicenter of the AI infrastructure revolution. With Magnificent Seven tech companies expected to spend upward of $430 billion on data center investments in 2026, the companies building servers, cooling systems, and thermal solutions are positioned for explosive growth.

The best servers and thermal stocks to watch in 2026 offer exposure to this secular megatrend without the lofty valuations of pure-play chip makers. From AI-optimized server manufacturers to precision cooling specialists, these companies are essential enablers of the data center buildout.

Key Takeaways

• Data center capex is accelerating: Magnificent Seven companies are projected to invest over $430 billion in AI and data center infrastructure in 2026, up from $414 billion in 2025
• Thermal management is critical: Power and cooling capacity are now as important as chip performance, with liquid cooling becoming standard for next-gen AI workloads
• Server revenue is surging: Super Micro Computer reported 123% YoY revenue growth in Q4, while Dell's AI server shipments are on track for $25 billion in FY26
• Mid-cap thermal plays offer asymmetric upside: Companies like Modine and nVent are growing 30%+ annually with strong backlogs extending through 2027

Like these picks? Our premium members get our actual portfolio holdings, entry prices, and real-time portfolio update alerts before anyone else. See Premium →

Best Servers & Thermal Stocks Summary Table

---

Super Micro Computer (SMCI)

Profile: SPECULATIVE — HIGH RISK | Risk: 4/5 | Conviction: Medium

Analyst target implies: +26% from current price

Super Micro Computer represents the highest-risk, highest-reward play in the server space. The company posted Q2 2026 revenue of $12.7 billion, more than doubling year-over-year, as delayed orders finally materialized.

Growth Catalysts

SMCI has established itself as a dominant force in AI-optimized servers and direct liquid cooling technology. The company's projected revenue growth of 85.9% for FY2026 tops the AI server sector. Revenue growth expectations sit around 18.6% annually with earnings growth forecasts near 33%.

The company's deep partnership with NVIDIA and leadership in liquid-cooled server racks positions it well for the Blackwell architecture ramp. Over 90% of SMCI revenue now comes from AI-related infrastructure.

Key Risks

Margin compression remains the primary concern. Gross margins collapsed to just 6.3% in Q2 2026 as aggressive competition and rising component costs squeezed profitability. The company's strong revenue base currently sits on relatively thin 3.1% net margins, leaving less room for error.

Accounting concerns from 2025 continue to weigh on sentiment, with the consensus analyst rating at "Hold" despite the growth trajectory.

---

Dell Technologies (DELL)

Outlook: Bullish | Risk: 2/5 | Conviction: High

Analyst target implies: +35% from current price

Dell Technologies offers the most balanced risk-reward profile among server stocks. The company is raising its AI shipment guidance to roughly $25 billion for FY26, representing over 150% year-over-year growth.

Growth Catalysts

Dell's Servers and Networking business grew 69% in Q2 FY26, driven by exceptional AI server demand. The company achieved record revenue of $29.8 billion in the quarter with operating income up 27% year-over-year.

Dell's AI server backlog reached $18.4 billion, representing 68% of annual revenue. The company has shipped $10 billion of AI solutions in the first half of FY26, surpassing all shipments in FY25 combined.

Analysts maintain a consensus "Buy" rating with an average price target of $163.13, implying 35% upside. Barclays and Goldman Sachs both upgraded the stock citing AI server demand and accelerating earnings growth.

Valuation

Full-year FY26 revenue is expected between $105 billion and $109 billion, up 12% year-over-year. Non-GAAP diluted EPS guidance of $9.55 represents 17% growth. At current prices, Dell trades at a significant discount to its AI infrastructure peers.

---

Vertiv Holdings (VRT)

Outlook: Bullish | Risk: 2/5 | Conviction: High

Analyst target implies: +24% from current price

Vertiv leads the data center thermal management market with $8 billion in annual revenue and relationships across major cloud providers. The company provides mission-critical thermal management, power distribution, and monitoring systems.

Growth Catalysts

Vertiv reported Q4 revenue of $2.68 billion, surpassing expectations by 3.4% with 29% year-over-year growth. The company boasts a robust $9.5 billion backlog supporting strong visibility through 2027.

EPS is expected to grow over 50% in two years. Vertiv's 2026 EPS is projected around $5.14, representing 25% year-over-year growth. The company recently announced its MegaMod HDX scalable hybrid cooling solution delivering capacity up to 10 MW and rack densities exceeding 100 kW.

Vertiv is moving to engineering-ready designs for 800 VDC power systems supporting future NVIDIA AI factories. These megawatt-scale rack systems are expected in the second half of 2026.

Competitive Position

Vertiv's thermal solutions are deployed in the largest hyperscale facilities globally. The company has scale that smaller competitors cannot match, with 31,000 employees worldwide. Barclays recently upgraded the stock to Overweight with a $200 price target.

---

Modine Manufacturing (MOD)

Outlook: Bullish | Risk: 3/5 | Conviction: High

Analyst target implies: +13% from current price

Modine represents the pure-play data center cooling opportunity. The company's Climate Solutions segment grew 30% in fiscal 2025, with data center sales reaching $644 million, up 119% year-over-year.

Growth Catalysts

Management projects data center revenue exceeding $2 billion by fiscal 2028, representing a compound annual growth rate of roughly 39% from fiscal 2022. The company has spent the last two years expanding manufacturing capacity in Europe and North America specifically for data center clients.

2026 represents the full utilization of this new capacity. Modine recently launched a new hybrid chiller engineered to efficiently manage increasing AI workloads. B. Riley raised its price target to $250 from $190, while Oppenheimer increased to $240 from $220.

Strategic Transformation

Modine has lowered its exposure to the legacy automotive segment and is focusing on high-growth climate opportunities. The company announced a spinoff of its Performance Technologies segment to be combined with Gentherm, allowing Modine to become a focused thermal management pure-play.

CEO Neil Brinker noted the company has visibility with some customers extending three to five years, which is unusual in industrial equipment.

---

Celestica (CLS)

Outlook: Bullish | Risk: 3/5 | Conviction: High

Analyst target implies: +33% from current price

Celestica has emerged as a leading AI infrastructure play with shares soaring 177% over the past year. The company raised its full-year 2026 revenue outlook to $17 billion, pointing to stronger demand tied to AI-focused data center technologies.

Growth Catalysts

Q4 2025 earnings per share of $1.89 surpassed consensus expectations of $1.76, while quarterly revenue of $3.65 billion exceeded the anticipated $3.49 billion. The company concluded 2025 with an impressive 28% increase in annual revenue.

Celestica's 2026 outlook calls for revenue of $17 billion and non-GAAP adjusted EPS of $8.20, representing growth of 31% and 39% respectively. The company now controls 55% of the custom Ethernet switch market, up from 40% in 2024.

Bank of America initiated coverage with a Buy rating and $400 price target, citing Celestica's leading position in high-speed data center switch manufacturing. Barclays raised their target to $391 while maintaining an Overweight rating.

AI Infrastructure Position

Celestica sits at the intersection of electronics manufacturing and hardware design services, supplying critical components and systems for data centers. The company is investing over $1 billion in capital expenditure aimed at boosting AI infrastructure capacity.

---

nVent Electric (NVT)

Outlook: Bullish | Risk: 2/5 | Conviction: Medium

Analyst target implies: +26% from current price

nVent Electric is the liquid cooling specialist positioned for the retrofit cycle as existing data centers upgrade to handle AI workloads. The company posted record AI data center-driven results with full-year 2025 sales up 30% to $3.9 billion.

Growth Catalysts

Data center sales reached approximately $1 billion in 2025. The company ended the year with a $2.3 billion backlog, triple from the previous year. Management guides to 15% to 18% reported sales growth in 2026.

nVent co-developed the liquid cooling reference design for NVIDIA's NVL72 rack, positioning them as the spec-in incumbent for the highest-density clusters. The company was added to NVIDIA's partner network, increasing visibility among global AI infrastructure customers.

A new Minnesota facility will double nVent's footprint for liquid cooling production in early 2026. Less than 10% of data centers are liquid-cooled today, but new GPU chips require more advanced cooling, supporting long-term demand.

Strategic Partnerships

nVent is collaborating with Siemens to co-develop cooling and power architectures focused on hyperscale AI workloads. The company has deployed more than 1 gigawatt of cooling capacity and has over a decade of experience in liquid cooling systems.

---

Navigating Server and Thermal Stocks

Risk Spectrum

For balanced exposure to the AI infrastructure buildout, the names cluster across the risk spectrum:

• Lower volatility: Dell (DELL) and Vertiv (VRT) offer stable growth with lower volatility
• Higher growth: Modine (MOD) and nVent (NVT) provide pure-play thermal exposure with higher upside
• Highest risk: Super Micro (SMCI) and Celestica (CLS) offer maximum leverage to AI server demand

Timing Considerations

The sector's momentum has come with sharp swings — historically, entry timing has materially affected outcomes, and pullbacks during broader market weakness have been common.

Key Metrics to Monitor

• Backlog growth: Strong leading indicator of future revenue
• Gross margins: Compression signals competitive pressure
• Data center revenue mix: Higher percentages indicate AI exposure
• Hyperscaler capex announcements: Drives demand visibility

---

Conclusion

The server and thermal management sector offers compelling opportunities as AI infrastructure spending accelerates through 2026 and beyond. Data centers are expected to consume over 1,000 TWh of electricity by 2026, requiring cooling systems that can manage constant thermal output.

For investors seeking exposure to the AI megatrend beyond chip makers, these server and thermal stocks provide essential picks-and-shovels plays. Dell and Vertiv offer the most balanced risk-reward for conservative investors, while Modine and nVent provide pure-play thermal exposure. Celestica and Super Micro deliver maximum leverage to AI server demand for those with higher risk tolerance.

The thermal management technologies market is estimated to grow from $14.74 billion in 2026 to $21.49 billion by 2031, representing a CAGR of 7.85%. Companies positioned at the intersection of power and cooling will remain essential enablers of the AI revolution.

---

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Always do your own research and consult a financial advisor before making investment decisions.