The nationwide data center build-out continues, though rife with politics.
Here we highlight 2 microcaps that may benefit.
Tredegar Corporation (TG) is a manufacturing company engaged, through its subsidiaries, in the production of aluminum extrusions and polyethylene and polypropylene plastic films. In 2025 the Aluminum Extrusions segment contributed about 86% of revenue with High Performance Films segment contributing the remaining 14%.
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Within the Aluminum Extrusions segment, about 54% of the end use applications are in the nonresidential building and construction industry. But digging further into the weeds, one finds that its relatively new TSLOTS business accounted for about 11% of volume in the latest quarter, and importantly the shipments grew 45% YOY supported by demand for data-containment and data-center infrastructure.
TSLOTS are aluminum modular systems utilized as aisle containment barriers, equipment enclosures, support frames, and server room workstations within data centers.
While not yet reported as 10% of total revenue, it appears to be getting close and is worth monitoring.
Importantly, for Tredegar Corporation (TG), this business could soon begin moving the needle on consolidated company performance. Zacks currently has a Neutral rating on the stock.
The other stock with a possible data center connection is The Monarch Cement Company (MCEM).
To be clear, the company has not publicly disclosed any benefit from the data center construction industry. This is speculation and prognostication on our part.
Image Source: Zacks Investment Research
The Monarch Cement Company (MCEM) manufactures and sells portland cement and operates through its subsidiaries in ready-mixed concrete, concrete products, bulk material hauling, and other building materials businesses.
But, data centers require a substantial amount of concrete for weight support with applications for foundations, high-load floors, server racks, and cooling plants.
The company has operations in Kansas, Iowa, Missouri, Arkansas, and Oklahoma. So, the investment thesis is that ongoing data construction build-out in the Midwest may benefit the company down the road.
Zacks currently has an Outperform rating on MCEM.
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This article originally published on Zacks Investment Research (zacks.com).
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