r/valueinvesting
“AI infrastructure beyond Nvidia: where is the real bottleneck — power, memory, or networking?”
Author seeks bear cases and valuation risks for AI infrastructure plays beyond Nvidia, focusing on power, networking, and memory bottlenecks.
- AI data center scaling is fundamentally constrained by power, networking, and HBM memory, creating long-term tailwinds.
- Secondary infrastructure supply chain offers significant long-term investment opportunities beyond obvious winners like Nvidia.
- A 30-40% slowdown in AI capital expenditure could severely impact the earnings and valuations of these infrastructure companies.
- High market expectations and potential overvaluation pose a risk of significant disappointment over the next three years.
I’m building a long-term AI infrastructure watchlist and trying to understand where the market may still be underestimating the bottlenecks.
The names I’m currently researching are:
Eaton (ETN)
Schneider Electric
GE Vernova (GEV)
Arista Networks (ANET)
Micron (MU)
My thesis is:
Nvidia and TSMC are obvious winners.
The next bottlenecks may be power infrastructure, networking and memory.
AI data centers cannot scale without electricity, transformers, switchgear, cooling, networking and HBM memory.
For those who follow these companies closely:
What is the strongest bear case for each?
Which company is most overvalued today?
Which company has the highest probability of disappointing over the next 3 years?
If AI capex slowed by 30-40%, which of these would get hit hardest?
Which one is the most misunderstood by the market today?
I’m not looking for price targets or short-term trades. I’m interested in understanding where the thesis could be wrong.
Did u just wake up from a long slumber?
You’re way late to this party already OP. These names you listed were noticed by Q1-2 2025 and all already found out and priced by Q4. At this point, you have to look for much smaller risky bets that may have some ties to data centers - I’m talking very niche names like $PPIH. The multibagger run up on your list is long gone. I found $FIX late 2024 and purchased April 2025 at about 15x earnings at $350 per share. Now it’s 55-60x earnings at $2000 per share. Basically, the same thing has already happened for all the other names you posted.
Where was TheFixGuy in late 2024 ? 😩
I made multiple posts about it on my other account u/Aevykin which has since for whatever reason been shadowbanned. My first post was over 1 year ago. It got a whopping 8 upvotes. I’ll show a DM of the post.
Thanks for the context!
Sure, to answer your other question, everything would be hit very hard if 30-40% cap ex slow down was announced. My guess at least 30-40%.
The next bottlenecks may be power infrastructure, networking and memory.
What's your LLM's knowledge cutoff, 2024?
Apeing into the AI isn’t value investing by any measure. The actual bottleneck for AI buildout is revenue. And I haven’t seen any credible answer to where the trillions in revenue actually comes from.
Even the premier AI labs are making maybe 100-150 bn in run rate revenue combined whereas the actual required revenue is more than a trillion to make a respectable return on the capex.
Honestly if capex slow by 30-40%, the whole AI buildout narrative will get destroyed. It doesn't matter if it's mega stocks like NVDA, power stocks like bloom energy, AI infrastructure like Vertiv. All will get destroyed.
AI has the most over studied supply chain on earth.