We recently published a list of 20 Best Data Center Stocks to Buy According to Billionaires. In this article, we are going to take a look at where Dell Technologies Inc. (NYSE:DELL) stands against other best data center stocks to buy according to billionaires.
Data centers have become the foundation of the digital economy, facilitating the storage, processing, and distribution of vast amounts of data that drive industries worldwide. According to McKinsey & Company, the global data center market is set for significant expansion through 2030, fueled by enterprise digital transformation and hyperscale cloud growth. Their analysis projects that global demand for data center capacity could grow annually by 19% to 22% between 2023 and 2030, ultimately reaching between 171 and 219 gigawatts (GW) of annual capacity (compared to 60 GW currently). As per McKinsey, at least double the data center capacity built since 2000 would have to be built in less than one-fourth of the time, to avoid a capacity shortfall.
At the start of the year, investor sentiment toward data centers soared following the high-profile announcement of Project Stargate, a landmark $500 billion initiative aimed at revolutionizing data center infrastructure. However, enthusiasm has tempered later in the first quarter as discussions have emerged over potential repealing of the CHIPS Act. This legislation was originally designed to strengthen U.S. semiconductor manufacturing and reduce reliance on foreign suppliers, and it has played a key role in reshaping domestic production capabilities. The ongoing debate over its future has introduced uncertainty into the market, influencing investor outlooks.
Amid these discussions, a February 2025 PwC report underscores the strategic importance of expanding data center infrastructure—not only for technological advancement but also for geopolitical stability. Nations are increasingly wary of relying on critical infrastructure in high-risk regions. Geopolitical tensions and trade restrictions continue to expose vulnerabilities in global supply chains, prompting companies to implement contingency strategies. PwC further adds that expanding into new markets introduces additional challenges, including strict security and data privacy regulations, particularly in non-U.S. jurisdictions with stringent compliance frameworks. As a result, data center operators must carefully balance regulatory requirements, infrastructure investments, and market demand while navigating an evolving global landscape.
In a March 10 interview with CNBC, Charlie Sanchez, President of Infrastructure Advisory at Black & Veatch, discussed the ongoing surge in AI-driven infrastructure investment, particularly within data centers. He emphasized that despite trade tariffs, the commitment to data center development remains robust, both in the U.S. and globally. Companies recognize AI’s potential to optimize supply chains, enhance energy efficiency, and unlock new value streams. Sanchez also highlighted that AI not only drives demand for infrastructure but also serves as a key enabler for future efficiencies. Moreover, advancements in AI and processing power are already being incorporated into the design of next-generation data centers, reinforcing the necessity for continued development and investment in the sector.
In summary, data centers play a crucial role in the modern digital economy, supporting innovation and global connectivity. Their sustained growth trajectory, driven by AI, cloud computing, and enterprise digitalization, presents a strong investment opportunity. With backing from both corporate and government stakeholders, data centers will remain at the core of economic transformation, serving as vital infrastructure for the data-driven future.
Our Methodology
To determine the 20 best data center stocks to buy according to billionaires, we conducted extensive research to identify key players in the data center sector. Our approach involved analyzing exchange-traded funds (ETFs), industry research reports, and proprietary databases to compile a comprehensive list of companies operating in the data center industry. We then refined our focus to the top 20 data center stocks most favored by billionaire investors, leveraging Insider Monkey’s Q4 2024 database to extract data on billionaire holdings. We have arranged them in ascending order based on the number of billionaire investors holding stakes in each company as of Q4 2024. Additionally, we provided insights into hedge fund sentiment surrounding these stocks, using data from Insider Monkey’s Q4 2024 database of over 1,000 elite hedge funds.
Note: All pricing data is as of market close on March 12.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
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Dell Technologies Inc. (NYSE:DELL)
Number of Billionaire Investors: 11
Billionaire Holdings: $259 million
Number of Hedge Fund Holders: 63
Dell Technologies Inc. (NYSE:DELL) is a key player in IT infrastructure modernization, with expertise in artificial intelligence (AI), software-defined solutions, and cloud-native infrastructure. The company’s extensive product portfolio includes personal computers, servers, storage solutions, networking, software, and cybersecurity. Within the data center segment, Dell delivers advanced solutions such as servers, storage systems, hyperconverged infrastructure (HCI), cloud computing platforms, modular data centers, and networking equipment, positioning itself at the forefront of next-generation AI-driven data center infrastructure.
On February 27, Dell Technologies Inc. (NYSE:DELL) reported steady Q4 2025 earnings (FY ending January), though its Q1 2026 guidance fell short of expectations. Revenue for the quarter reached $23.9 billion, marking a 7% year-over-year increase, while EPS climbed 18% to $2.68, benefiting from improved cost discipline. The company highlighted strong AI-driven demand, reporting $1.7 billion in AI orders for the quarter, with $2.1 billion in shipments and a $4.1 billion backlog as customers adapt to evolving technology needs. However, Q1 2026 EPS guidance came in weaker than anticipated.
Following the earnings release, a Morgan Stanley analyst described the results as better-than-feared overall, acknowledging the mixed nature of Q4 performance but highlighting strong FY 2026 EPS guidance of $9.30, which exceeded forecasts. The analyst suggested that Dell could potentially surpass $10 EPS this year, given management’s tendency to issue conservative guidance. He maintained his FY 2026 EPS estimate of approximately $9.50, reaffirmed an Overweight rating, and kept his $128 price target unchanged.
Overall, DELL ranks 19th on our list of best data center stocks to buy according to billionaires. While we acknowledge the potential of DELL to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than DELL but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires
Disclosure: None. This article is originally published at Insider Monkey.
