Artificial intelligence spending is fueling the Wall Street bull market as big tech bets big on power-hungry AI data centers and beyond. The AI hyperscalers, including Amazon, Meta, and others, are projected to spend roughly $400 billion in capex in 2025 alone. Global data center infrastructure spending is expected to reach $7 trillion by 2030.<\/p>\n
There is no end in sight to the wave of AI spending that extends to energy and grid infrastructure because generative AI platforms like ChatGPT use 10X the energy\u00a0of an average Google search.<\/p>\n
The two AI-related stocks we dive into today are not the tech stocks most associated with AI, such as Nvidia. Nonetheless, Constellation Energy and Arista Networks benefit directly from the AI megatrend that\u2019s poised to dominate Wall Street in the back-half of the decade and beyond.<\/p>\n
Zacks Investment Research <\/p>\n
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Let\u2019s dive into why investors should buy CEG and ANET now before possible breakouts in October and the fourth quarter. Both AI-boosted stocks are also long-term buy-and-hold candidates.<\/p>\n
Constellation Energy CEG\u00a0is at the forefront of the growing relationship between big tech and nuclear energy. CEG earned 20-year power purchase agreements with Microsoft and Meta META\u00a0over the last year to support their AI expansion efforts. <\/p>\n
The largest U.S. nuclear power plant operator is ready to transform into\u00a0one of\u00a0the\u00a0energy industry titans of the AI age through Constellation\u2019s $27 billion deal to buy natural gas and geothermal powerhouse Calpine.<\/p>\n
CEG\u2019s acquisition, which is expected to close in Q4, creates the largest clean energy firm and expands Constellation\u2019s footprint into power-hungry, tech-heavy Texas and California.<\/p>\n
Constellation stock is poised to be one of the most surefire long-term winners in the AI-driven energy age as the U.S. government aims to quadruple nuclear energy capacity by 2050 and AI hyperscalers go all-in on nuclear and natural gas.<\/p>\n
Zacks Investment Research <\/p>\n
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It\u2019s poised to power large swaths of the economy and AI data centers via CEG\u2019s established portfolio of reliable 24\/7 power.\u00a0Constellation is also\u00a0expanding into next-gen small modular nuclear reactors (SMRs), where it competes against pre-revenue home-run stocks such as Oklo.<\/p>\n
Constellation raised its dividend by 10% in 2025 and 25% in 2024 as part of a plan to consistently boost its payout to shareholders. The nuclear energy powerhouse is expected to grow its adjusted earnings per share (EPS) by 9% in 2025 and 27% in 2026. <\/p>\n
Story Continues <\/p>\n
Its near-term trajectory is part of\u00a0Constellation’s\u00a0\u201cvisible, double-digit long-term base EPS growth backed by the Nuclear Production Tax Credit.\u201d The chart above shows that CEG\u2019s earnings revisions are trending higher.<\/p>\n
Zacks Investment Research <\/p>\n
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CEG stock climbed 300% in the last three years to outpace the S&P 500\u2019s 87%. The stock has jumped 55% in 2025 to outpace Meta and many AI hyperscalers. <\/p>\n
Constellation trades 15% below its average Zacks price target, and it looks ready to break out into a new trading range at some point in October or the fourth quarter. Constellation also trades at a 20% discount to its highs at 29.1X forward 12-month earnings.\u00a0<\/p>\n
Buy Meta and Microsoft AI Partner ANET Stock<\/p>\n
Arista Networks ANET\u00a0is a client-to-cloud networking powerhouse for large AI, data center, campus, and routing environments. ANET\u2019s networking infrastructure expanded rapidly over the past decade alongside the explosion of cloud computing, big data, and most recently, artificial intelligence.<\/p>\n
ANET\u2019s products help connect computers and servers, ensuring fast and reliable data transfer. In short, Arista helps provide some of the \u2018plumbing\u2019 that keeps large-scale tech operations such as AI running smoothly. <\/p>\n
AI hyperscalers, Microsoft MSFT\u00a0and Meta, are two of Arista\u2019s largest clients, highlighting to investors that ANET\u2019s portfolio is full of best-in-class AI data center-focused offerings.<\/p>\n
Zacks Investment Research <\/p>\n
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ANET grew its revenue from $361 million in 2013 to $7 billion in 2024, boosted by 32% average sales growth in the trailing four years. Arista Networks is projected to grow its sales by 25% in FY25 and 20% in 2026 to reach $10.52 billion, more than doubling its revenue between 2022 and 2026.<\/p>\n
Arista\u2019s impressive balance sheet ($8.8 billion in cash and equivalents and zero debt) should help expand its reach within AI and whatever technological revolution might come next. The networking infrastructure firm is projected to grow its adjusted earnings by 24% in 2025 and 14% in FY26 to extend a huge run of bottom-line expansion.<\/p>\n
ANET\u2019s FY25 consensus EPS estimate has jumped 10% since its Q2 release, with its FY26 outlook 9% higher to help it earn a Zacks Rank #1 (Strong Buy). The tech company has also beaten our quarterly earnings estimates for five years running.<\/p>\n
Zacks Investment Research <\/p>\n
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ANET skyrocketed 3,700% in the past 10 years to blow away Meta\u2019s 680% and Tech\u2019s 433%, including a 415% surge over the last three years. Despite trading near its all-time highs, its valuation levels mark a 28% discount to\u00a0Arista’s\u00a0peaks. <\/p>\n
The stock experienced a bullish golden cross, where the 50-day moves above the 200-day, in late July. Arista stock could be poised to charge higher in Q4 after gapping above its early 2025 peaks in early August following a huge beat-and-raise Q2 report.\u00a0 \u00a0<\/p>\n
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report<\/a><\/p>\n Microsoft Corporation (MSFT) : Free Stock Analysis Report<\/a><\/p>\n Constellation Energy Corporation (CEG) : Free Stock Analysis Report<\/a><\/p>\n Arista Networks, Inc. (ANET) : Free Stock Analysis Report<\/a><\/p>\n Meta Platforms, Inc. (META) : Free Stock Analysis Report<\/a><\/p>\n This article originally published on Zacks Investment Research (zacks.com).<\/a><\/p>\n