Data center pivot: TH stock upgrade

What happened: Target Hospitality (TH) shares surged in premarket trading on January 15, 2023, following a new contract win. The company will provide mobile housing and hospitality services for workers at data center construction projects. Meanwhile, Bloom Energy (BE) shares surged in Q4 2022 due to increased demand from data centers, as reported by ClearBridge Investments.

Market impact: The data center boom is driving demand for supporting services, benefiting companies like Target Hospitality. The data center industry's growth, fueled by cloud computing and AI, is pushing up demand for related services and equipment, as seen in Bloom Energy's Q4 surge.

What to watch next: On February 15, 2023, Target Hospitality will report its Q4 earnings, providing insights into the company's growth prospects in the data center sector. Additionally, investors should monitor data center construction starts and completions, as reported by the U.S. Census Bureau, to gauge future demand for Target Hospitality's services.