We recently published a list of Why These 15 Data Center Stocks Are Skyrocketing So Far In 2025. In this article, we are going to take a look at where GDS Holdings Ltd (NASDAQ:GDS) stands against other data center stocks that are skyrocketing so far in 2025.
There have been murmurs of a data center and cloud computing slowdown for the past two years, but none of that has materialized and the data center industry has instead accelerated as companies double down on AI. Even after DeepSeek, investors are pretty bullish on data center stocks as AI companies are learning from DeepSeek’s efficiency to create even more powerful AI models.
The data center sector is projected to grow at a 9.29% CAGR from 2025 to 2033, potentially reaching $494.5 billion by 2033. As such, there are plenty of opportunities if you dig deeper into the market and many of them have just started to rally this year. It’s a good idea to look into the ones spearheading the gains.
Methodology
For this article, I screened the top-performing data center stocks year-to-date. Stocks that I have covered recently will be excluded from this list.
I will also mention the number of hedge fund investors in these stocks. Why are we interested in the stocks that hedge funds invest in? 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 275% since May 2014, beating its benchmark by 150 percentage points. (see more details here).
A top level executive looking out of a skyscraper window, symbolizing the strategic decisions taken by the company.
GDS Holdings Ltd (NASDAQ:GDS)
Number of Hedge Fund Holders In Q4 2024: 32
GDS Holdings Ltd (NASDAQ:GDS) makes high-performance data centers in China and Southeast Asia.
The stock is up significantly so far in 2025 as there have been rumors of a potential DayOne IPO, though the company later clarified that no concrete IPO plans exist. DayOne is GDS Holdings’ international data center business unit that operates outside of mainland China.
Regardless, it surged after TD Cowen’s price target increased to $39. Morgan Stanley also maintained an Overweight rating with a $39 price target ahead of Alibaba’s earnings, which is a major client of GDS Holdings.
The consensus price target of $22.6 implies 49.45% downside.
GDS stock is up 89.85% year-to-date.
Overall, GDS ranks 2nd on our list of data center stocks that are skyrocketing so far in 2025. While we acknowledge the potential of GDS as an investment, our conviction lies in the belief that some 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 GDS 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 Complete List of 59 AI Companies Under $2 Billion in Market Cap
Disclosure: None. This article is originally published at Insider Monkey.
