Hidden tech stock turns heating systems into gold mine for investors
Air-conditioning company profits skyrocket due to artificial intelligence data centers needs. Top investors pile into this under-the-radar stock that connects old-school engineering with new-tech boom
The rise of artificial intelligence creates unexpected winners - air-conditioning systems are now hot-property in the tech world. The reason: AI needs lots of data-centers which produce massive heat and need cooling
Comfort Systems a New York-listed engineering firm shows how traditional business can benefit from tech revolution. Its main focus is heating ventilation and air-conditioning (HVAC) systems which now became crucial for data-centers operations; the companys stock value went up three times in just two years
The firms market position looks solid - it has $5.7bn worth of orders (more than last years total sales). Their mechanical division which handles HVAC systems brings in 80% of money and serves various sectors but tech industry remains key client. Besides cooling they do:
- plumbing installations
- electrical systems work
- automated monitoring setup
- energy management services
Top investment experts seem to like the stock. Nick Sheridan from Janus Henderson says: “US climate control market is huge; with nation-wide coverage Comfort Systems targets $350bn market while having just 1.5% share now“
Last years numbers look good - profits went up 31.5% reaching $323.4m with 25.8% revenue growth. The company keeps growing in 2024 too. However stock isnt cheap trading at 29 times expected earnings but for tech-related company thats not unusual
In other news Elf Beauty stock (recommended in march) lost 35.3% after famous short-seller Muddy Waters questioned their accounting. With growing doubts about companys future its time to sell
