We recently published a list of 10 Mid-Cap IT Stocks Outperforming The Market In 2025. In this article, we are going to take a look at where VNET Group Inc. (NASDAQ:VNET) stands against other mid-cap IT stocks outperforming the market in 2025.
US Stocks continue their recovery from a post-DeepSeek and post-tariffs period as nerves surrounding Donald Trump’s unpredictable policies calm down. The Nasdaq is surging 1.19% followed by the S&P 500 at 0.64%. The bullishness is expected to continue for the remainder of the day.
To determine which stocks could outperform the market in the coming months, it is essential to look at sectors that are benefitting from ongoing trends. IT stocks are unique in a way that with time, all companies have to spend more to keep their systems updated. Analysts expect companies to add 5% to their IT budgets in 2025. This, together with the increasing demand for AI products, will propel the sector’s returns in 2025.
Some companies have already started the year on a positive note. There are companies that are seeing increasing demand for their innovative products while others continue to serve the infrastructure involved in deploying these innovative solutions. Either way, it is important to look at what’s driving these stocks.
We decided to take a look at the top 10 mid-cap IT stocks that are outperforming the market in 2025. To come up with our list, we only considered stocks with a market cap of at least $10 billion with the highest return since the start of the year.
A close up image of a application hosting server with the company’s branding on it.
VNET Group Inc. (NASDAQ:VNET)
VNET Group Inc. is an investment holding company that provides hosting and related services in China. The company offers interconnectivity services, managed hosting services, and value-added services. It provides its services to individuals, government agencies, gaming & entertainment, e-commerce, financial services and other industries.
VNET stock has nearly doubled since the 1st of January 2025. However, even this performance pales in comparison to the 466% one-year returns. This is a $2.4 billion market cap company that may well be experiencing a re-rating right now. Getting in while it’s hot may not be everyone’s cup of tea. But let’s try to dig more and see if the rally is justified and if there’s still enough juice left in it.
One of the reasons for the company’s outperformance is that the barriers to entry for AI-driven data centers are very high. When companies need to deploy any significant IR capacity in a short period of time, there’s only a handful of companies that can do that, VNET being one of them. The company also benefits from its main competitors, ZDATA and Centrin Data, shifting their focus to other parts of their business.
As long as AI training and inference demand keeps up, VNET’s business looks pretty solid. A solid pipeline of orders coupled with this demand can continue the stock’s revival, which had seen a lot of shareholder wealth destruction in the last 4 years.
Overall, VNET ranks 1st on our list of mid-cap IT stocks outperforming the market in 2025. While we acknowledge the potential of VNET as a leading AI investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as VNET but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
