Why VNET Group Inc. (VNET) Is Skyrocketing?

We recently published a list of 10 Stocks Outperform Broader Market on Wednesday. In this article, we are going to take a look at where VNET Group Inc. (NASDAQ:VNET) stands against other stocks that outperform broader market on Wednesday.

The stock market finished in the red territory on Wednesday as investors sold off positions to mitigate risks from a fresh round of tariffs due in the next few days.

The tech-heavy Nasdaq fell the hardest, down 2.04 percent, followed by the S&P 500, down 1.12 percent. The Dow Jones declined by 0.31 percent.

According to President Donald Trump, all cars made outside of the US would be slapped with a 25-percent tariff beginning April 2.

Meanwhile, let us take a look at the 10 companies across mixed sectors that defied a broader market downturn, having registered modest to strong gains during the trading session.

To come up with the list, we considered only the stocks with $2 billion market capitalization and $5 million in trading volume.

A close up image of a application hosting server with the company’s branding on it.

VNET Group Inc. (NASDAQ:VNET)

VNET rose by 4.95 percent on Wednesday to end at $8.90 apiece as investors bought up on shares following the prior day’s losses.

Investor sentiment was further supported by a recent upgrade for the company’s stock. On Monday, VNET earned an upgrade in VNET’s corporate family rating to B2 from B3 previously, and was given a “stable” outlook from “positive.”

Moody’s Senior Analyst Shawn Xiong said that the B2 rating was based on VNET’s strong position in China’s IDC market, its strategically located data centers with significantly expanded wholesale IDC capacity, a steady revenue growth record, diversified customer base, and established partnerships with leading cloud service providers and internet giants.

According to Xiong, VNET is expected to post solid revenues and earnings growth over the next 12 to 18 months, supported by operational synergies from strategic shareholder Shandong Hi-Speed Holdings.

Apart from Moody’s, VNET also earned a better rating from Bank of America, with a revised price target of $17.30, up from $14.50 previously. It also maintained a “buy” rating on the company.

The more optimistic outlook was based on the company’s much higher guidance on capacity delivery targets, now between 400 to 450MW as compared with the 153MW actual delivery in 2024.

Overall, VNET ranks 4th on our list of stocks that outperform broader market on Wednesday. While we acknowledge the potential of VNET 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 as promising as VNET but 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.