Invest in surging AI power demand like a top hedge fund

Today’s issue in preview:

• Invest in surging AI power demand like a top hedge fund

• Bloom Energy surges to new highs. Here’s why that’s important for your portfolio

• The U.S. government wants you to make money in these stocks. How to invest with a powerful partner.

• Our extraordinary track record gets even better: Our thematic trades in Semi Equipment, Robotics, Biotech, AI Power Consumption, and Scandium reach new highs.

Bloom Energy surges to new highs. Here’s why that’s important for your portfolio

Credit: Bloom Energy

Last week, the Federal Energy Regulatory Commission (FERC) ordered six of the nation’s largest electric grid operators to fast-track connection requests from data centers and other big electricity users.

The new policy is viewed as an aggressive move to eliminate power-related AI development bottlenecks… and to keep the U.S. ahead of China in the AI race.

Thanks to this announcement and soaring AI-related electricity demand, electrical infrastructure leader Bloom Energy (BE) jumped 15.4% on Thursday to reach a new all-time high. Shares gained an additional 3.3% this morning.

This is a strong signal that the “AI Power Consumption” theme is one of the market’s strongest trends… and a deserving investment.

Avid Money & Megatrends readers are familiar with the bull case for owning AI Power Consumption stocks.

Given AI’s enormous promise, large tech firms such as Google, Amazon, Microsoft, OpenAI, Oracle, and Meta have invested over $1 trillion in specialized semiconductors, data centers, and other AI infrastructure components. They are on pace to invest around $700 billion this year alone and more than $3 trillion after that. Both the scale and the velocity of this investment boom are unprecedented. It is the largest collective investment effort of all-time.

All that AI infrastructure is poised to consume huge amounts of electricity. Goldman Sachs forecasts global data center power demand will climb 50% by 2027 and as much as 165% by the end of the decade. J.P. Morgan forecasts that global power demand will grow at a 3.6% compound annual rate from 2026 to 2030, a pace 50% higher than the previous decade.

Bloom Energy is one of the leading stocks benefitting from this trend. Bloom Energy manufactures the Bloom Energy Server – aka “Bloom Box” – a transportable power generation system that converts fuels like natural gas into electricity.

Bloom Boxes are in very high demand among AI data center operators because they enable data centers to reduce their reliance on strained electric power grids and go online faster than with conventional power systems. This demand drove 130% year-over-year earnings growth in Q1.

When you invest in the industries and companies that supply the growing AI industry with electric power, you are not risking your money by trying to pick the company that creates the best AI model. You’re not betting on which media, retail, transportation, or manufacturing company best leverages AI to beat the competition.

Instead, you’re making the safe bet that every company and every individual using AI ends up buying some electricity to power it. No matter who builds the best AI applications… no matter who builds the best AI semiconductors… every AI company and every AI user must buy some electricity.

The giant business and technological trends that shape our world play out over years, not months. This means the financial market trends they manifest tend to persist for years, not months. It also means new all-time highs are often followed by more all-time highs. Trends tend to persist, and winners tend to keep on winning, and Issac Newton was right: An object in motion tends to stay in motion.

With all this in mind, I see Bloom’s new high as evidence the AI Power Consumption theme is alive and well. More new highs are likely in the future.

Invest in surging AI power demand like a top hedge fund

Credit: Jeremy Poland

Bloom Energy’s unique product and strong stock price action make it a favorite among momentum traders, who look to buy stocks with exceptional business growth and strong price trends.

Rather than “buy low and sell high,” momentum traders look to “buy high and sell higher.”

But what about AI Power Consumption stocks for people who prefer to hunt in the bargain bin… and buy unloved stocks that are closer to new lows than new highs?

If this describes you, I encourage you to look at the Independent Power Producer (IPP) stock group.

IPPs are companies that own fleets of electric power plants and sell their production to the highest bidders. Unlike conventional regulated utilities that are tightly controlled by local governments, IPPs operate relatively freely. They can take capital expenditure risks that regulated utilities can’t make and charge higher prices that regulated utilities can’t charge. This makes IPPs higher-risk, higher upside investments than conventional utilities.

The group of established IPP stocks is relatively small. Back in May, I detailed how IPP giants Constellation Energy (CEG) and Vistra Energy (VST) are two leaders in this area… and owned by some of the world’s top hedge funds, such as Dan Loeb’s Third Point.

In addition to these two giants, investors can consider smaller IPPs such as NRG Energy (NRG), Talen Energy (TLN), and Canada’s TransAlta (TAC). NRG is a holding of top hedge fund manager David Tepper. Talen is a holding of top manager Scott Ferguson. These guys have enormous research budgets, teams of experts, and access to privileged information. And they are buying IPP stocks.

IPP stocks enjoyed a big rally from mid-2023 to mid-2025. Since then, they have digested their gains and traded lower, with NRG, VST, and CEG reaching one-year lows. Given the electric power industry’s bullish long-term fundamentals, these stocks are likely to resume their long-term uptrends.

The U.S. government wants you to make money in these stocks. How to invest with a powerful partner.

Credit: vadimrysev

Being bullish on scandium turned out to be a great idea.

This morning, leading scandium mine developer Sunrise Energy Metals (SREMF) surged 7.4% to reach a new all-time high. Shares are up 142% since our recommendation in March.

This big move is more confirmation that the critical resource industry is full of opportunity.

In June 2025, I wrote a research piece on how the U.S. government has become a powerful partner for investors in the critical resource industry. It’s a development with huge financial implications that can make investors a lot of money.

My megatrend thesis goes like this: President Donald Trump has staked his legacy and reputation on massively expanding U.S. manufacturing capacity. The Trump administration is working with business leaders to invest trillions to pursue this goal.

However, any plan to increase domestic manufacturing capacity faces a big problem: we lack the critical resources to build the required infrastructure and future manufacturing inputs.

We don’t have the copper, iron ore, rare earths, lithium, antimony, nickel, and other vital building blocks required to build all those data centers… all those factories… all those robots… all those electric grids… all those power plants… and so on.

To make matters worse, we also lack the refining, smelting, and processing facilities needed to turn the raw forms of those resources into ready-to-use end products. We rely on China for a lot of that.

It’s like we very much want to build a big house… but we don’t have the lumber, the screws, or the nails we need to make it happen. It’s a major hindrance to Trump achieving one of his ultimate goals.

Meanwhile, innovations in defense tech, battery tech, and AI are driving enormous demand growth in many critical resource markets.

All this makes many critical resource industry areas rich with opportunity.

In our March 20 issue, we highlighted how scandium is one of the most important metals most people don’t know about. It’s a critical component in the production of military hardware, such as missiles.

When combined with other metals like aluminum, it creates a very lightweight, but high-strength structure. This is why securing critical minerals like scandium has become a national security imperative. Without scandium, the U.S. doesn’t have the most advanced missiles and drones. As the U.S. rebuilds depleted missile stockpiles from Operation Epic Fury, scandium demand will rise.

Scandium also has an “AI demand kicker” that should act as a long-term tailwind. This month, Bloom Energy announced it wants to double manufacturing capacity by the end of 2026. This matters a lot to scandium producers because Bloom is considered one of the world’s largest single consumers of the metal.

As detailed above, Bloom produces fuel cells that help power AI data centers. Its fuel cells use scandia-stabilized zirconia as a core electrolyte material. It’s what allows the cells to operate efficiently at the required operating temperatures. In other words, scandium is in the chemistry of what Bloom’s technology does.

Bloom Energy has no publicly announced supply agreement with Sunrise. But on its Q1 2025 earnings call, CEO K.R. Sridhar said the company does not source scandium from China. It sources it from multiple undisclosed sources. This is purely speculative, but Sunrise owns the world’s largest and highest-grade primary scandium deposit.

It appears to be the most logical long-term answer: Bloom partners with Sunrise in some form, just as defense giant Lockheed Martin (LMT) has. Lockheed Martin has a five-year option agreement in place to purchase up to 25% of Sunrise’s scandium.

The Western world has one serious primary scandium project. The world’s largest defense contractor has already signed a deal with its owner. And there’s an “AI demand kicker” that should work in scandium’s favor. It’s yet another example of how the critical resource megatrend we’ve been bullish on is creating wealth and winners.

Market Notes

• Our biotech trade continued its winning ways today. The SPDR S&P Biotech ETF (XBI) jumped 3% this morning to reach a new one-year high.

• Our recommendation to invest in the semiconductor equipment industry continues to pay off. Industry leaders Applied Materials (AMAT), Lam Research (LRCX), and KLA (KLAC) reached new all-time highs today. This group is up 76% since our March 20 recommendation.

• Our recommendation to invest in the Power Management Semiconductor theme via Texas Instruments (TXN) is a solid winner so far. TXN jumped 2.7% this morning to reach a new all-time high.

• Our recommendation to invest in the AI Chemicals boom is off to an excellent start. Chemicals leader Entegris (ENTG) jumped 2.7% this morning to reach a new one-year high.

• The supersonic tsunami that is AI continues to harm the software industry. Software giants Salesforce (CRM), SAP (SAP), and Adobe Systems (ADBE) reached new one-year lows today.

• RBC Bearings (RBC) – our high-tech manufacturing and robotics “pick to click” – reached a new all-time high today.

Regards,

Brian Hunt
Editor, Money & Megatrends

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