Grid Stocks & AI’s Power Play: Cynic’s Take

AI. The latest buzzword everyone wields like a corporate ceremonial sword. Suddenly, data centers sprout like weeds, each guzzling enough electricity to power a small nation. And let’s be honest-the only thing these facilities are truly training is our collective ability to ignore absurd energy bills. Companies will tell you this is “the future,” but I say it’s just a fancy way to justify another round of stock buybacks. 🤷

This frenzy should propel Nvidia’s stock higher-though I’d question whether their GPUs are really “revolutionary” or just overpriced calculators with better marketing. But Nvidia won’t be the only winner? Please. In this game, there’s always someone to clean up the mess.

Powering these data centers requires electricity. Lots of it. So, electric grids-those ancient, creaky systems we’ve ignored for decades-will need upgrades. Which, conveniently, creates a “buy thesis” for grid stocks. Because nothing says “sound investment” like betting on the same companies that couldn’t keep the lights on during a snowstorm. 🌩️

The Nvidia-OpenAI $100 Billion, 10+ Gigawatt “Deal”

Nvidia recently announced a $100 billion investment in OpenAI. Now, I’m not saying they’re trying to defraud shareholders, but when you mention “10 gigawatts” of systems-enough to power New York City during a heatwave-it feels less like a partnership and more like a PR stunt. [Emphases mine, because who doesn’t love redundant exclamation points?]

Putting 10 Gigawatts in Context (Or Why I Hate Analogies)

Let’s parse this “10 gigawatts” claim:

New York City’s average demand is ~6.5 gigawatts. Its peak? ~10-11 gigawatts. So, OpenAI’s deal is basically saying, “We’ll use as much power as a city during its worst heatwave.” Because nothing says “superintelligence” like destabilizing the grid.
10 nuclear reactors = 10 gigawatts. Which means this deal is equivalent to building 10 nuclear plants… but with fewer meltdowns and more buzzwords.

What Is the Electric Grid? (Spoiler: It’s a Mess)

The electric grid is an interconnected network with three stages: generation, transmission, and distribution. It’s like a Rube Goldberg machine designed by accountants. Regulated utilities handle it all, while other companies do bits and pieces-because why not fragment responsibility for something as critical as electricity? It’s a masterclass in corporate compartmentalization.

2 Electric Grid Stocks to Buy (If You Like Overpriced Certainty)

Companies are listed by descending market cap. Enjoy:

Company	Market Cap	Forward P/E	Wall Street’s Estimated 5-Year EPS Growth	YTD 2025 Return	10-Year Return
GE Vernova (GEV)	$162 billion	50.6	N/A. 66.2% next year.	81.1%	N/A. Up 354% since April 2024.
Quanta Services (PWR)	$62.8 billion	33.4	16.9%	33.4%	1,630%
S&P 500 Index				15.3%	310%

Both stocks yield ~0.16% and 0.10% dividends. Because nothing says “long-term growth” like pocket change. 💸

GE Vernova: The Energy Empire

GE Vernova spun off from General Electric in April 2024. It now runs three segments: power, wind, and electrification. Because nothing says “diversification” like juggling gas, hydro, nuclear, and wind turbines in the same portfolio. The company claims 25% of global electricity is generated using its tech. Which is impressive… until you realize 25% of nothing is still nothing.

In H1 2025, revenue rose 11% to $17.1 billion. Electrification revenue jumped 19% to $4.1 billion. Wind revenue? Up 11% to $4.1 billion. Power revenue? Up 8% to $9.2 billion. It’s like a magic trick: Every segment gets a “growth” pat on the back, even as GAAP net income plummets 36% to $756 million. But don’t worry-adjusted EBITDA surged 72% to $1.23 billion. Adjusted for what? Accounting wizardry, probably.

Backlog? $129 billion. Growth? +$5 billion in Q2. Because nothing builds confidence like a backlog larger than GDP. At this rate, they’ll run out of projects before they run out of cash. 🏗️

With a forward P/E of 50.6, GE Vernova is “reasonably valued” for a company expected to grow earnings 66.2% next year. Because who *wouldn’t* pay 50x earnings for a 66% growth promise? It’s like buying a lottery ticket… with a 401(k).

Quanta Services: The Infrastructure Contractor

Quanta installs, repairs, and maintains energy/communications infrastructure. It operates in the U.S., Canada, and “certain other international markets.” Translation: They avoid places with sane labor laws. Two segments: electric and underground infrastructure. Because why not split responsibilities for something as vital as burying cables?

H1 2025 revenue rose 22% to $13.0 billion. Electric segment revenue jumped 24% to $10.4 billion. Underground? Up 17% to $2.6 billion. GAAP net income? Up 22% to $374 million. EPS? Up 20% to $2.47. It’s a numbers game, and Quanta’s playing to win.

Backlog? $35.8 billion. Recent contract win: Idaho Power’s Boardman to Hemingway transmission line. A 300-mile, 500-kV project delivering 1 gigawatt of power. Quanta will “design, engineer, procure, and construct” it. Because why trust anyone else with something as simple as stringing wires across states?

Forward P/E of 33.4 for 16.9% expected EPS growth. It’s pricey, but “quality” commands a premium. Or as I call it, “paying for the privilege of not losing money.” Wall Street’s probably lowballing Quanta’s growth-because optimism is a luxury they can’t afford. 🚀

In conclusion: The grid needs upgrades to support AI’s power demands. Stocks of grid companies may offer “attractive long-term investments.” Or they may be another corporate boondoggle dressed up in buzzwords. Either way, someone’s making money. Probably not you. 😏

2025-10-07 05:02