Breakout Watch: Top Funds Fire Up This AI Infrastructure Stock

The artificial intelligence revolution continues to drive demand far beyond the likes of Nvidia (NVDA), Palantir Technologies (PLTR) and Alphabet (GOOGL). AI infrastructure stocks like Quanta Services (PWR) and Emcor (EME) have also attracted big bets from Wall Street.

Showing unabated demand for AI stocks, Quanta Services and Emcor joined Nvidia, Alphabet, Palantir on the latest monthly report on new buys by the best mutual funds, As Quanta trades near a buy point and Emcor remains in buy range, they also join Alphabet on the Investor's Business Daily Breakout Stocks Index.

Are AI Stocks In A Bubble? Here's What The Data Says.

Quanta Services Rides AI Infrastructure Boom And Beyond

Based in Houston, Quanta Services provides specialized infrastructure solutions to the utility, renewable energy, technology, communications, pipeline and energy industries. With operations throughout the United States, Canada, Australia and other international markets, the company's services include designing, installing, repairing and maintaining energy and communications infrastructure.

Strong demand for AI data centers has also boosted demand for Quanta's electrical and other systems.

Top money managers scooped up over $414 million worth of Quanta Services in the latest list of new buys by top funds. They also poured over $649 million into Emcor.

In the second quarter, Quanta Services generated more than $6.73 billion in revenue, marking a 21% year-over-year gain. Earnings growth rose 31% to $2.48 per share.

When the company reports third-quarter numbers on Oct. 30, analysts forecast 14% sales growth to around $7.38 billion. Earnings are expected to grow 20% to $3.26 a share.

For the full year, Wall Street sees earnings rising 18% to $10.57 per share, followed by a 17% gain to $12.39 per share in 2026.

See All The Names On The IBD Breakout Stocks Index

AI Demand Fuels New Breakout

With the tech-heavy Nasdaq continuing to notch new highs, Nvidia — Tuesday's IBD Stock Of The Day — Palantir and fellow AI infrastructure play Emcor all trade in or near a buy zone.

Shares of Quanta Services hit a record high Wednesday after earlier clearing a 424.94 buy point in a second-stage cup pattern. On Tuesday, the stock retreated below that entry as the market got jittery, but it rebounded Wednesday. Shares are currently up around 3%.

At the beginning of the month, the 21-day exponential moving average climbed back above Quanta's 50-day line and it continues to rise. It is a telltale clue of improving technical strength when a shorter-term moving average retakes its longer-term cousin.

In a sign of market leadership, the relative strength line has turned higher, but remains shy of its 52-week high.

Its strong industry group provides anoAs AI continues to fuel demand for names like Nvidia and Palantir, AI infrastructure firm Quanta Services breaks out. ther promising indicator for Quanta Services. With a 97 Composite Rating out of a best-possible 99, Quanta sits among the leaders in the Building-Heavy Construction group, which ranks a lofty No. 14 among the 197 industries IBD tracks. Stock market history shows that the top-performing stocks often hail from the top-ranked industry groups.

IBD Breakout Opportunities ETF

The IBD Breakout Opportunities ETF (BOUT) from Innovator Capital Management tracks the IBD Breakout Stocks Index. As with other index ETFs, this fund allows you to invest in the entire index in addition to, or rather than, buying individual stocks. Learn more here about the ETF and Innovator.

Follow Matthew Galgani on X (formerly Twitter) at @IBD_MGalgani.

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