Editor's note: Regular Chaikin PowerFeed readers know all about AI's insatiable demand for power... As we've discussed many times, the massive AI infrastructure build-out means a lot of energy-hungry data centers. However, we've also noted an ominous side to all this for local communities – unreliable, erratic power.
Editor's note: Regular Chaikin PowerFeed readers know all about AI's insatiable demand for power...
As we've discussed many times, the massive AI infrastructure build-out means a lot of energy-hungry data centers. However, we've also noted an ominous side to all this for local communities – unreliable, erratic power.
Today, we're sharing insights from our friend Sean Michael Cummings with more details on this problem...
Regular readers will recognize Sean. He's an analyst over at our corporate affiliate Stansberry Research.
This essay from Sean was published in the November 17 edition of Stansberry's free DailyWealth e-letter. And in it, he explains how one energy technology can help power data centers and reduce the strain on America's energy grid...
Don't Overlook the Hidden Force Powering the Next Era of AI
By Sean Michael Cummings, analyst, Stansberry Research
America's electricity supply is becoming increasingly strained...
As of March, the U.S. has 5,426 artificial intelligence ("AI") data centers. That's up from about 1,000 in 2018.
As you're probably aware, data centers are gluttons for energy. In 2022, they consumed about 17 gigawatts ("GW") of power. (For reference, the Hoover Dam only produces about 2 GW per year.)
But the power has to come from somewhere. Today, it's being pulled from American homes.
Last year, a study by Bloomberg and Whisker Labs found that U.S. power supplies are being "distorted" by electricity-hungry data centers. It sounds like the plot of a sci-fi movie, but it could cost the U.S. billions of dollars if nothing changes.
And there's only one technology that can fix it...
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Electricity travels in waves. And the quality of the wave is important.
Home appliances rely on smooth, predictable waves that deliver steady voltage.
But as the grid gets strained, the waves become unsteady. This condition is known as "bad harmonics."
Bad harmonics continuously damage whatever's plugged into the grid. Over time, devices lose efficiency until they eventually break. And it can even cause blackouts and electrical fires.
And no one is immune...
The Bloomberg study found that homes within 20 miles of a data center experience the worst distortion. Last year, nearly 4 million people in the U.S. lived in the most impacted areas.
Once electricity starts to distort, only one thing can restore harmony: more energy capacity.
But neither conventional nor renewable energy can keep up...
AI Can't Scale Without Batteries
AI draws massive amounts of power in short, unpredictable bursts... sometimes for milliseconds at a time.
Coal, fossil fuels, and nuclear sources can supply steady baseline power. But they can't ramp up to meet these demand spikes. And wind and solar are too intermittent to do the job.
Plus, these energy sources have fixed locations. The farther a data center is from a pipeline or wind farm, the more it must rely on the grid – and the worse harmonic distortion becomes.
But one energy technology can help fix data-center distortion: batteries.
Batteries can sit anywhere in the energy supply chain – from distributors to data centers. And they can both absorb and release power.
That makes them ideal buffers for AI's volatile demand cycles. Take a look...
Battery systems can bring distorted electric waves back into harmony. And as distortion gets worse, these businesses are set to soar.
Battery companies are a little-known way to invest in the AI data-center build-out. As the build-out accelerates, these companies could see a wave of new growth.
Don't get left behind... Keep your eye on battery stocks.
Good investing,
Sean Michael Cummings Editor's note: With the big-name AI darlings dominating the financial media, plenty of folks are missing out on the other stocks powering the AI boom. And there's another massive story that most investors have no idea is unfolding right now...
It involves a specific group of stocks that the U.S. government could target with billions of dollars. Already this year, you could have doubled your money on a staggering 28 different stocks connected to this list.
Now, according to two of the world's leading experts on these stocks, you have a rare chance to get in before Washington makes its next big move. Get the details here.
Market View
Major Indexes and Notable Sectors
# Hld: Bullish Neutral Bearish
Dow 30
+0.98%
8
14
8
S&P 500
+1.0%
91
246
163
Nasdaq
+0.75%
19
48
33
Small Caps
+2.83%
473
1038
399
Bonds
+0.3%
Materials
+2.24%
3
8
15
— According to the Chaikin Power Bar, Small Cap stocks remain somewhat more Bullish than Large Cap stocks. Major indexes are mixed.
* * * *
Sector Tracker
Sector movement over the last 5 days
Health Care
+1.83%
Consumer Staples
+0.83%
Communication
+0.51%
Real Estate
-0.12%
Materials
-0.48%
Utilities
-0.69%
Financial
-1.49%
Industrials
-1.57%
Consumer Discretionary
-2.33%
Energy
-2.83%
Information Technology
-5.19%
* * * *
Industry Focus
Telecom Services
8
21
10
Over the past 6 months, the Telecom subsector (XTL) has outperformed the S&P 500 by +18.27%. However, its Power Bar ratio, which measures future potential, is Weak, with more Bearish than Bullish stocks. It is currently ranked #13 of 21 subsectors and has moved down 2 slots over the past week.
Indicative Stocks
UNIT
Uniti Group Inc.
GOGO
Gogo Inc.
ASTS
AST SpaceMobile, Inc
* * * *
Top Movers
Gainers
ROST
+8.41%
ALGN
+7.34%
BLDR
+7.14%
DHI
+6.84%
ODFL
+6.33%
Losers
ORCL
-5.66%
VST
-2.99%
LHX
-2.27%
CEG
-2.22%
CRWD
-2.12%
* * * *
Earnings Report
Earnings Surprises
MOG.A Moog Inc.
Q4
$2.56
Beat by $0.34
BJ BJ's Wholesale Club Holdings, Inc.
Q0
$1.16
Beat by $0.07
BKE The Buckle, Inc.
Q0
$0.96
Beat by $0.01
* * * *
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