The race to upgrade America’s power grid is on. These stocks are in the lead

Today’s issue in preview:

• The race to upgrade America’s power grid is on. These stocks are in the lead

• AI needs power that never stops. How to invest in an industry that delivers it

• The worst chart in the world for Republicans?

• BULLISH: Optical networking stocks break out to new highs.

• Due to the holiday, Money & Megatrends will not publish tomorrow, April 3. Your next issue will arrive on Monday, April 6.

The race to upgrade America’s power grid is on. These stocks are in the lead

Credit: zhaojiankang

Since reaching an all-time high in January, the benchmark S&P 500 index is down about 5%. This Epic-Fury-induced weakness has made it so there are far fewer stocks reaching new all-time highs than we see in “less chaotic” geopolitical and business environments.

The greatly reduced number of stocks performing well makes the recent new all-time highs registered by Preformed Line Products (PLPC) and MYR Group (MYRG) all the more noteworthy and interesting. Plus, it’s further confirmation that our Power Grid Upgrade theme is one of the market’s strongest, most rewarding investment trends.

On October 2, I detailed how big tech firms Google, Microsoft, Meta, OpenAI, and Amazon are making the biggest business “bet” in history. They are spending hundreds of billions of dollars per year on data centers, AI chips, and other infrastructure components. Their total investment in this space will exceed $600 billion this year and reach trillions more over the next five years.

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.

This creates a big investment opportunity.

The U.S. power grid is often called the world’s largest machine. It’s a giant network of power stations, transmission lines, substations, and underground wires. Most people barely know it’s there or how it works, but without this big machine, your lights don’t turn on, there’s no Netflix, and your iPhone doesn’t charge.

Industry experts say the power grid is aging and creaking under the strain of increased electricity demand. The American Society of Civil Engineers (ASCE) gave the energy sector a D+ in its 2025 Infrastructure Report Card, citing concerns about rising energy demand, aging infrastructure, and a lack of transmission capacity.

Soaring electricity demand… a grid badly in need of an upgrade… AI supremacy on the line… trillion of dollars of economic output on the line…

This is a recipe for a bull market in companies that build, repair, and upgrade our power grid.

MYR Group and Preformed Line Products are uniquely well-positioned to benefit from this megatrend. MYR is one of America’s largest electrical infrastructure building and maintenance companies. Preformed Line Products is one of America’s largest manufacturers of electric grid components. Thanks to the big push to expand and strengthen the U.S. power grid, both firms are enjoying strong revenue and backlog growth.

Both firms have bucked the broad market’s recent weakness to register all-time highs this week. MYR is up 154% over the past year. Preformed Line Products is up 105% over the past year.

Gigantic business and technology trends that change the world tend to play out over years, not months. The Power Grid Upgrade is one such trend. Money & Megatrend is still bullish.

AI needs power that never stops. How to invest in an industry that delivers it

Credit: SteveAllenPhoto

In our March 26 issue, I detailed how the war in Iran has raised all kinds of unanswered questions, but from a business and investment standpoint, one consequence is clear: the various bull markets in electric power production will go from strong to stronger.

Today’s piece (above) on the Power Grid Upgrade theme notes that the huge boom in AI data center construction is poised to create a huge new source of electric power demand.

This demand is driving a big bull market in virtually every form of electric power production. In these pages, I’ve highlighted trends and opportunities in solar energy, nuclear energy, utility stocks, natural gas producers, and Power Grid Upgrade investments.

These themes have generated extraordinary wealth and big capital gains over the past two years. They are very likely to continue doing so.

Not that they needed a boost, but Epic Fury is giving them one.

Closing the critical Strait of Hormuz justifiably gets a lot of press. It is a vital waterway through which roughly 20% of global oil consumption flows.

In addition to oil, vital natural gas and fertilizer supplies flow through the strait. Its closure is having destructive consequences for businesses and countries that depend on Middle Eastern resource flows. Those consequences could go from “destructive” to “catastrophic” if the closure lasts another month.

For many countries and businesses, this situation is a brutal “slap in the face” reminder: If you’re a large business or country whose survival or smooth operation depends on uninterrupted resource flows from the Middle East, you are in a dangerous, vulnerable position.

If your business or country depends on resource flows from the Middle East, you are not truly safe or secure. No CEO or major shareholder wants their business to be in that position. No citizen wants their country to be in that position. Many powerful and influential people are realizing this is a big risk that must be mitigated if humanly possible.

This means building and buying as many forms of “not Middle Eastern” resource supply chains as possible economically… with electric power production being the most important.

The drive to become more energy independent is not a one-year-and-you’re-done project. It is a multi-decade megatrend. It will act as a long-term tailwind for virtually every form of energy production, helping businesses and countries become less reliant on Middle Eastern oil and gas.

One big beneficiary of this megatrend that flies under the radar of most investors is the geothermal power industry. Geothermal energy is electric power generated by drilling deep into the Earth’s crust to reach hot rocks and hot water reservoirs and using superheated water from the process to turn power plant turbines.

Geothermal energy is a relatively niche energy source. It meets less than 1% of global electricity consumption. However, it’s a growing industry that can be solidly profitable in many geographic locations. And, like most other electric power sources, it has a powerful AI tailwind at its back.

But don’t take my word for it. Take the market’s word. The market has sent blue-chip geothermal power producer and equipment firm Ormat Technologies (ORA) up 61% over the past year. Analysts attribute the rise to the company’s rising sales and strong expected growth throughout the coming decade. As you can see in the chart below, Ormat stock suffered a pullback in February, but it is poised to regain its highs and continue running.

Businesses that supply safe sources of solar energy, nuclear energy, and geothermal energy were doing well before Epic Fury. The consequences of the war will provide them a boost.

The worst chart in the world for Republicans?

Credit: mokee81

Last night, President Trump took to the airwaves and provided an update on the war in Iran. In response to his aggressive tone, the market sent crude oil prices up 13%. Energy-related stocks rose. Consumer stocks fell.

In other words, we continue to be in the grip of what I’ve been calling “Groundhog Day for investors.” On Monday, I described how the situation works:

From an investment standpoint, it feels like we are living the same week over and over. The week goes like this: Donald Trump makes a claim about how well the war is going, hoping it will send oil prices lower. Iran issues a counterclaim and strikes another target. Oil prices go up. We hear the Strait of Hormuz might open. We hear the Strait of Hormuz is still closed. Stocks in a small number of industries that benefit from reduced critical resource supplies and corresponding high prices – oil, chemicals, fertilizers – go up. Most stocks go down or move sideways.

Rinse and repeat.

Groundhog Day for investors.

In this movie, critical price action in the broad market averages and most individual stocks is not being driven by industry fundamentals, valuations, or interest rates. It’s almost all being dictated by Operation Epic Fury and Donald Trump’s social media posts. Most of the market is trading in a unified “blob” that rises or falls based on how the war is going and how it is being spun in the media.

If the war ends soon, the S&P is very likely to pop higher and move higher over the long term. If the war does not end soon, its constriction of critical resource supplies will seriously damage the global economy, and stocks will trade lower. That’s all price action direction comes down to these days. It’s all quite tedious.

Today, let’s also add that if Epic Fury does not end soon, the market below will haunt the Republicans come November. The chart shows the past two years’ trading in the spot price of U.S. gasoline.

As you can see, the price of gas declined from last August through January. But it has skyrocketed in the wake of Operation Epic Fury. AAA reports that the average cost of a gallon of gas has jumped 36% since the war started… and that gas climbed above $4 yesterday for the first time since August 2022. This is the kind of price move that can cause landslide election defeats in America. Even worse, inflationary forces associated with high gas prices will also drive up mortgage rates, which would be another negative for Republicans at the voting booths.

Politics is not our beat at Money & Megatrends. We prefer less disgusting/depressing subjects. However, government decisions often influence and occasionally dictate stock and commodity price movements. Perhaps the high price of gas will help lead to the end of Epic Fury and “Groundhog Day for investors.” I’ll make that my Easter Day wish.

Market Notes

• The AI infrastructure boom continues. The AI-powered optical networking bull market we’ve been covering is back on. Today, optical networking leaders Lumentum (LITE) and Cienna (CIEN) reached new all-time highs.

• The chemicals uptrend continues. Chemicals giant Westlake Chemical (WLK) reached a new one-year high today.

• Offshore oil drilling leader Noble (NE) reached a new all-time high today.

• The AI infrastructure boom sent the market value of data center operator Equinix (EQIX) to a new one-year high today.

• The critical resources uptrend continues. Aluminum giant Century Aluminum (CENX) reached a new one-year high today.

Regards,

Brian Hunt
Editor, Money & Megatrends

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