Data Center Buildout Boosts Natural Gas Use: WMB, AR & KMI to Gain?
The world is gradually witnessing a widespread adoption of artificial intelligence (AI) across all businesses, which is driving a significant increase in demand for data centers. These data centers house sophisticated servers and supporting infrastructure required by AI to process data and train models. To support this immense computing power and intense workload, data centers are in increasing need of more electricity, which is raising the demand for natural gas.
This is because the electricity generated from natural-gas-fired plants is cleaner. With the rising demand for natural gas, the outlook becomes bright for companies involved in exploring, producing and transporting the commodity from the shale plays to the end market. Three energy players that are well-poised to grow are Antero ResourcesAR, WilliamsWMB and Kinder Morgan Inc.KMI.
3 Energy Stocks to Benefit: AR, WMB & KMI
Antero Resources is a leading explorer and producer of natural gas in the United States. In the Appalachian Basin, among the prolific plays, the company has a strong footprint, brightening the production outlook. Thus, being a prominent producer in the United States, AR is well-positioned to capitalize on the data center-led mounting energy demand. AR currently carries a Zacks Rank #3 (Hold).
Williams is a midstream energy giant with a huge pipeline network, involved in transporting roughly 33% of the natural gas produced in the domestic market. Thus, the outlook for #3 Ranked WMB also remains bright. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Kinder Morgan is also a midstream energy major. Employing its huge pipeline network, KMI, with a Zacks Rank of 3, is responsible for carrying roughly 40% of the natural gas being produced in the domestic market.
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