Mid-cap 'data center stock' Argan triples in LTM, trouncing Nvidia
Shares of the mid-cap Argan, which provides construction services to the energy sector, have more than tripled over the last 12 months, "smashing" the world's most valuable company, Nvidia, in terms of performance, notes the Investor's Business Daily. It argues that now is a good time to buy Argan stock ahead of a new breakout.
Details
Argan has soared 207% to $236.89 per share in the last 12 months. This is much better than tech giants Nvidia and Microsoft, which have advanced 58% and 20%, respectively, over the same period, the Investor's Business Daily notes. Their gains have fueled the S&P 500, which tracks large-cap companies, to set record after record last week, explained Jeffries strategists in a note cited by Bloomberg.
Drivers of Argan stock
Argan, with a market capitalization of $3.2 billion, focuses on construction and related services to the power industry. The company also provides infrastructure for the industrial construction and telecommunications industries.
But it is Argan's activity related to the construction of data centers that explains its soaring stock, the Investor's Business Daily argues. As the AI frenzy spurs Wall Street interest in Nvidia, Microsoft, Meta and others, it also boosts interest in data centers and companies like Argan that fuel this power-hungry industry, the publication writes. The stock is "building a new buy point" and has been added to the Investor's Business Daily Leaderboard watchlist.
A week ago, JPMorgan initiated coverage on Argan, assigning a "neutral" rating and a target price of $220 per share (below current quotes). JPMorgan sees Argan as a key player in the anticipated multiyear buildout of U.S. gas power plants, which is expected to drive the bulk of its growth, wrote Insider Monkey in its recap of the JPMorgan initiation. In addition, Argan’s exposure to solar-plus-storage and industrial construction is seen as adding diversification.
The stock has two "buy" ratings from Wall Street analysts and one "hold," according to MarketWatch. The average target price of $225.33 per share is below current quotes.
The AI translation of this story was reviewed by a human editor.
