Forget Hyperscalers, These Stocks Are The New AI Plays

Alex Sirois

Mon, May 18, 2026 at 1:14 PM EDT 4 min read

Quick Read

• Caterpillar (CAT) Power Generation revenue grew 41% YoY to $2.817B in Q1 2026 with total revenue up 22% to $17.415B and EPS beating consensus by 19.3%; Eaton (ETN) Electrical Americas hit record $3.51B revenue (up 21% YoY) with 24.9% segment margin and acquired Boyd Thermal for $9.5B to expand data center cooling; Vertiv (VRT) Q1 2026 revenue jumped 30% YoY to $2.6495B with $15.0B backlog (up 109% YoY), book-to-bill near 2.9x, and 2026 guidance raised to $13.50B-$14.00B in sales with adjusted EPS of $6.30-$6.40.

• Caterpillar, Eaton, and Vertiv, the overlooked infrastructure providers powering the AI buildout, are generating record results and backlog growth while trading with minimal retail attention compared to crowded AI chip names.

• The analyst who called NVIDIA in 2010 just named his top 10 stocks and Caterpillar wasn't one of them. Get them here FREE.

The leading AI chip names are dominating every AI headline, and for good reason: their chips and platforms sit at the center of the buildout.

But here's what you should actually be watching.

The crowded chip trade already prices in every bullish scenario investors can dream up. Retail money piles in on every dip, options chains stay lit, and the consensus is so dense that any disappointment carries asymmetric downside. Meanwhile, the unglamorous companies physically building the AI economy keep posting record numbers with almost no retail noise. That is what an uncrowded trade looks like, and it is exactly where a retirement-focused investor wants to be hunting.

The analyst who called NVIDIA in 2010 just named his top 10 stocks and Caterpillar wasn't one of them. Get them here FREE.

Caterpillar: the power plant behind the GPU

Caterpillar (NYSE:CAT) does not show up in AI ETFs, yet its Power Generation product line grew 41% YoY to $2.817 billion in Q1 2026, driven by large reciprocating engines and turbines feeding hyperscale data centers. Total revenue hit $17.415 billion (up 22.22% YoY), reported EPS landed at $5.54 versus a $4.6439 consensus (a 19.3% beat), and net income climbed 27.26% YoY to $2.549 billion. Management deployed $5.028 billion in buybacks plus roughly $0.7 billion in dividends in the single quarter. CEO Joe Creed pointed to a record backlog providing "a strong foundation for continued positive momentum". Shares are up 57.33% YTD and 179.78% over the past year, and retail still cannot be bothered.

Eaton: electrifying the rack

Eaton (NYSE:ETN) runs the electrical distribution that turns Caterpillar's power into usable kilowatts inside the hall. Q4 2025 Electrical Americas revenue hit a record $3.51 billion (up 21% YoY, 15% organic) at a record 24.9% segment margin, with electrical backlog up 29% YoY and a book-to-bill of 1.1. The company is acquiring Boyd Thermal for $9.5 billion to bolt liquid cooling onto the data center stack, with the deal expected to close in Q2 2026. 2026 guidance calls for 7% to 9% organic growth and adjusted EPS of $13.00 to $13.50. CEO Paulo Ruiz framed it directly: the company is "confident that this momentum positions us to capitalize on the significant opportunities ahead, from digitalization and AI to reindustrialization, infrastructure spending and growth in the aerospace markets." Shares are up 26.79% YTD.