FIX - Up 100% In 4 Months - Building Data Centers As Fast As They Can!

Summary

The video script discusses two companies, Modine and Comfort Systems USA (Fix), that are capitalizing on the immense demand from tech giants like Google, Amazon, and Microsoft to build massive data centers for their AI and computing initiatives. The demand is so high that these construction firms can barely keep up, leading them to acquire other companies and charge premium prices. The narrator enthusiastically examines their financials, growth prospects, and stock performance, positioning them as compelling investment opportunities to ride this AI-driven construction boom.

Takeaways

• 😄 Modine and Comfort Systems USA (ticker: FIX) are benefiting from a surge in demand for data center construction driven by tech giants like Google, Amazon, Microsoft, and Meta.
• 🏗️ These companies are involved in constructing massive data centers required to support the computing power of AI systems like Jensen's GPUs and Cerebras' supercomputers.
• 📈 Modine's stock is up 100% over the last 4 months, while FIX has gained 107% in the past year, largely since October 2023.
• 💰 FIX's revenues grew 26% year-over-year, and its backlog of orders increased by $1 billion (20%) to $5.2 billion, with some customers paying upfront.
• 🌐 The demand for data center construction is so high that these companies are being selective about clients and acquiring other firms to meet the unprecedented demand.
• 💥 The speaker believes this is an extraordinary opportunity fueled by tech giants' willingness to spend heavily to enable transformative technologies like AI.
• 📊 FIX's earnings are expected to grow 26% in 2024 and 13.6% in 2025, reflecting the sustained demand for their services.
• 🕵️ The speaker researched FIX by analyzing its earnings reports, CEO commentary, stock charts, and technical indicators to identify potential buy-in opportunities.
• 💎 The speaker suggests investors should strategically position themselves to capitalize on this once-in-a-lifetime opportunity by investing in companies like Modine and FIX.
• 🔍 Further analysis is required to determine the optimal buy-in prices for these stocks based on technical indicators and potential market corrections.

Q & A

What companies are discussed in the script?

The main companies discussed are Modine, a company in the air conditioning business, and Comfort Systems USA (ticker symbol FIX), a building contractor company.

What is the reason behind the growth of these companies?

The growth is driven by the demand from big tech companies like Google, Amazon, Microsoft, and Meta to build and revamp massive data centers to handle the accelerated compute capacity required for advancements like Jensen's GPUs and Char's supercomputers.

How are these companies meeting the high demand?

Both Modine and Comfort Systems USA are going out and acquiring other companies to increase their capacity and meet the demand. They are also being paid upfront by clients to prioritize their projects.

What is the significance of the positive cash flow being greater than revenue for Comfort Systems USA?

It highlights the high demand and the clients' willingness to pay upfront to secure their projects, showing the favorable position the company is in.

What is the process followed by the speaker to research Comfort Systems USA?

The speaker looks at Seeking Alpha for stock performance and earnings estimates, listens to the company's earnings call, analyzes the CEO's comments, and evaluates technical indicators like moving averages and Fibonacci retracements.

What is the significance of the growth in the backlog for Comfort Systems USA?

The increase in backlog by $1 billion (20%) from the previous year indicates a strong pipeline of future work and revenue for the company.

How does the speaker view the future potential of these companies?

The speaker believes that the demand for building data centers will continue for at least five years or more, presenting a significant opportunity for companies like Modine and Comfort Systems USA.

What is the next step mentioned by the speaker?

The next step is to determine the optimal buying price or entry point for the stocks of Modine and Comfort Systems USA, considering technical indicators and potential dips or corrections.

What is the speaker's overall assessment of the situation?

The speaker views this as an opportunity of a lifetime, driven by the massive investments and demand from big tech companies to build the infrastructure required for their future advancements and offerings.

What is the speaker's call to action at the end of the script?

The speaker encourages listeners to sign up for their Platinum program, which is currently on sale, to get insights on determining the buying opportunities for Modine and Comfort Systems USA stocks.

Outlines

00:00

📚 Discovering the Modine and Comfort Systems USA (FIX) Companies

The speaker discusses a video they made about Modine, a company in the air conditioning business, whose stock has risen 100% in the last four months due to revamping data center cooling systems. A viewer asked about Comfort Systems USA (FIX), an $11 billion building contractor involved in constructing massive data centers for tech giants like Google and Amazon. The speaker researched FIX and found their business is booming due to high demand for data center construction, leading them to acquire other companies to meet the workload.

05:00

🏗️ FIX's Rapidly Growing Business and Financial Performance

The speaker examines FIX's recent earnings report, which highlights their 26% year-over-year revenue growth, $5.2 billion backlog (up $1 billion from last year), and strong financial position. The CEO, Brian Lane, explains that big tech companies are hiring them for data center construction, both modular and on-site. FIX is being selective about clients due to overwhelming demand and has been paid upfront for some projects. The stock has doubled since October 2023, and FIX has acquired two more companies to keep up with the workload.

10:03

📈 Evaluating Investment Opportunities in FIX and Modine

The speaker expresses amazement at the unprecedented demand and profits in the data center construction industry, driven by tech giants' ambitions to revolutionize various sectors. They plan to analyze FIX's and Modine's technical indicators, such as moving averages and Fibonacci retracements, to identify ideal entry points for investment. The speaker encourages viewers to join their investment program to capitalize on these unique opportunities in the companies supplying the hammers, nails, and concrete for massive data center projects.

Keywords

💡Data Centers

Data centers are large, specialized facilities designed to house and operate computer systems and associated components like telecommunications and storage systems. In the context of this video, the rapid growth of big tech companies like Google, Amazon, and Microsoft has created an unprecedented demand for building new and revamping existing data centers to handle the massive increase in computing power required for emerging technologies like AI and high-performance computing. The script mentions companies like Modine and Comfort Systems USA being overwhelmed with orders to construct these vast data centers.

💡HVAC

HVAC stands for Heating, Ventilation, and Air Conditioning. It refers to the systems and technologies used to regulate indoor air quality and temperature in buildings. In the video, the company Modine is highlighted for its expertise in revamping and rebuilding HVAC systems specifically for data centers. Proper cooling and air circulation are crucial for the efficient operation of the densely packed computing hardware in these facilities.

💡Backlog

A backlog refers to the accumulated orders or work that a company has yet to complete or deliver. The video mentions that Comfort Systems USA has a backlog of $5.2 billion worth of orders, up $1 billion from the previous year. This significant backlog indicates the overwhelming demand for their services in constructing data centers, to the point where they are becoming selective about which projects to take on.

💡Modular Construction

Modular construction is a method of building where individual components or modules are pre-fabricated off-site and then transported to the final location for assembly. The video highlights that companies like Comfort Systems USA offer both traditional on-site construction (referred to as 'stick-built') as well as modular construction methods for data centers. Modular construction can often be faster and more efficient for certain types of large-scale projects.

💡Big Tech

Big Tech refers to the largest and most dominant technology companies, such as Google, Amazon, Microsoft, Meta (Facebook), and Apple. In the video, these companies are described as the primary drivers of the unprecedented demand for data center construction and expansion. Their ambitious plans for technologies like AI, cloud computing, and high-performance computing necessitate the rapid buildout of massive data center facilities.

💡Jensen/Charle's

These are likely references to Jensen Huang, the CEO of Nvidia, and Charles 'Char' Bachman, the inventor of the Bachman diagram in database modeling. The video suggests that the advancements in AI and computing power enabled by Nvidia's GPUs (like the Jensen architecture) and the development of 'super macro computers' (likely a term for advanced, large-scale computing systems) are driving the need for expanded data center capacities.

💡Acquisitions

Acquisitions refer to the process of one company purchasing another company or business. The video mentions that both Modine and Comfort Systems USA are actively acquiring other companies to help them meet the surging demand for data center construction. These strategic acquisitions allow them to rapidly expand their workforce, capabilities, and capacity to take on more projects.

💡Positive Cash Flow

Positive cash flow is a situation where a company's cash inflows (from sales, investments, etc.) exceed its cash outflows (expenses, investments, etc.). The video notes that Comfort Systems USA had more positive cash flow in the last quarter than their total revenue, implying that customers were paying them upfront to secure their services. This is a sign of strong demand and financial health for the company.

💡Bonanza

A bonanza is a situation or circumstance that brings great wealth, profit, or prosperity. In the context of the video, the narrator describes the current surge in demand for data center construction as a 'bonanza' for companies like Modine and Comfort Systems USA. This unprecedented level of orders and revenue opportunities is likened to a windfall or lucrative opportunity that these companies are striving to capitalize on.

💡Technical Analysis

Technical analysis refers to the study of past market data, primarily price and volume, to identify patterns and trends that can inform trading decisions. The video mentions the narrator's intention to perform technical analysis on the stocks of Modine and Comfort Systems USA, such as examining moving averages, gaps, and Fibonacci retracements, to identify potential entry points or 'buy-in' opportunities for these stocks.

Highlights

The company Modine, which is in the air conditioning business, is experiencing explosive growth as they are revamping and rebuilding air conditioning systems in data centers.

The commenter 'printer gang Investments' asked about the company 'fix' (Comfort Systems USA), which is a $11 billion building contractor involved in constructing data centers.

There is a huge demand for building massive data centers to handle the accelerated compute capacity driven by advancements like Nvidia's Jensen GPUs and supermacro computers.

Companies like Modine and Comfort Systems USA are being bombarded with demands to build data centers, and they are acquiring other companies to meet this demand.

Both Modine and Comfort Systems USA are experiencing rapid revenue growth, with Comfort Systems USA's revenues up 26% from the prior year and a backlog worth $5.2 billion.

Comfort Systems USA is being selective in choosing clients, turning away some business, and prioritizing existing customers due to the overwhelming demand.

Comfort Systems USA's stock price has doubled in the last four months, from $153 in October 2023 to $312 currently.

The speaker believes that the demand for data center construction is an opportunity of a lifetime, and he recommends finding the right entry point to invest in companies like Modine and Comfort Systems USA.

The speaker emphasizes the importance of extensive research to determine the fair market price and potential dips in stock prices to identify buying opportunities.

The speaker offers access to his Platinum program, which provides guidance on investment opportunities like Modine and Comfort Systems USA, related to the data center construction boom.

The speaker sees the data center construction demand as a phenomenon driven by tech giants like Amazon, Google, Microsoft, and Meta, who are investing heavily to profit from upcoming advancements.

Comfort Systems USA has acquired two new companies since January 1st to help meet the demand from big tech companies.

The speaker highlights the unprecedented nature of the current data center construction boom, which even the CEO of Comfort Systems USA has never experienced before.

The speaker draws a parallel between the data center construction boom and his previous video on a company called "Your Future," which offers access to knowledge for $339.99 a month.

The speaker believes that the tech giants are investing heavily in data centers because they know the potential profits and world-changing capabilities of the upcoming advancements will make the construction costs insignificant.

Transcripts

I did a video last week on a company by

the name of Modine it's in rine

Wisconsin and they're in the air

conditioning business and I explained to

you that their business is exploding

because they're revamping and uh

rebuilding the air conditioning systems

in the data centers and uh their stock

is up 100% over the last four months and

I I got a uh response in in the comments

from that video uh that basically asked

me uh it it was from printer gang

Investments that that's the guy's handle

and he says I like my D Modine what's

your opinion of fix fix in small letters

and I had I I didn't know what he meant

but so I I searched it and I found that

fix is actually a building contractor

it's a 11 billion company uh and it's

it's it stands for or it's its name is

Comfort Systems USA and so uh I I looked

at it and I want to walk you through the

steps I took to familiarize myself with

fix uh Comfort Systems USA because what

I realized is yeah uh Google and and

apple and Amazon and Microsoft are

throwing a ton of money at at getting

these uh data centers revamped to handle

the accelerated compute capacity that is

coming with the with Jensen's gpus and

Char's um super macro computers but what

I what I what I'm learning is there's

there's a whole other element of this

that is not Tech it's not semiconductor

it's it's brick and mortar not brick but

actually steel and and and and

fiberglass and and and concrete to build

these massive data centers uh thousands

of square feet millions of square feet

and somebody's got to build them and and

it's a demand that wasn't there two

years ago and these companies are being

bombarded and in both Modine and fixes

uh cases they're going out and buying

other companies to help them get this

done such as in in fix as I'll explain

to you they they can build it from the

stick that is come on site and build you

what you want or they have plants

modular plants where they'll build the

parts and then ship it to you and put

this thing up and they're their business

is growing faster than they can keep up

and in both cases um both Modine and and

comfort systems they're going out and

buying other companies to help them meet

the demand and as they say usually what

happens is we buy these companies and

within three years they've tripled in

size because of the demand of for what

we're have we're getting and and they're

saying uh our our as as we're our

revenues are going up our margins are

going up equally if not greater so we're

we're getting better business from

people we know that can pay us and

actually pay us up front he said he said

in fact we had more positive cash flow

this last quarter then we had Revenue

because people were paying us in in

advance to build for them so that they

could move to the front of the line

that's right he said their their

positive cash flow was greater than

their revenues think about that that and

and and and the work isn't done yet and

won't be done for a matter of of of

months these

people are in a Bonanza and I think the

key now is to figure out how to how to

price their stock and and where to buy

in but let me first take you to to my

computer and show you how I

research um uh fix to come to the

conclusion that this is something I have

to own I'll get to that right after I

explain this is not Financial

advice best of us investors presents

Carrie

GM so the first thing I do is I go to

Seeking Alpha and I come across this

chart that says they're up uh 107% in

the last year and I look at it and I can

say say Well it all happened basically

since October the 26 2023 it's gone up

uh I I then always go and look at their

earnings and um what their earnings

estimates are and it says that uh their

earnings are going to go up 26% in 2024

and then another 13.6% in

2025 uh I then go back to the summary

and I said well how big of a company is

this it's a market cap of 11 uh .2

billion so it's not a it's not a monster

but it's a good siiz company the next

thing I do is uh I go to this this is

their annual report um our quarterly

report fourth quarter it was on February

the 23rd so it's pretty current and I

come in here and I I I basically say

play the call I forward it up to where I

get to the CEO and and he starts telling

me about his company his name is Brian

Lane and he's uh he's going to explain

to me how they've had a a banner quarter

and how it's How their company is

growing Leaps and Bounds and he he's

going to tell me that their their growth

is basically because the big tech

companies have been calling them and and

telling them we need you to build us

some data centers and you can both you

you you have you can build build them

what they call stick or you can build

them in modular and and he tells me that

that his business's revenues are up 26%

from the prior year and he and then he

goes on to tell me that he has a backlog

of uh $5.2 billion worth of orders some

of them in particularly the modular ones

he's been paid up front on them um so

that and that that backlog is up a

billion dollars from what it was last

year that's

20% um and and that um that's going to

give them they're they're booked for all

their work work uh for the next three

quarters and big Tech is asking them to

to book more and and basically he's

saying we're having to be pretty um

discriminatory as to who we do business

with and we've got to deal do business

with those that we've done business in

the past so we're turning a lot of

people

away yeah that's what I found so then I

said well okay let's let's look at uh

how is how is their price how's their

stock doing and so I come over here and

I look at their their chart and and I

see that um I could could have bought

this stock back on October the 23rd 2023

for about um

$153 and today it's selling for uh uh

312 so it's doubled in price in the last

four months and and so then my question

is well is that a flash in the pan has

has the has uh the the market grown into

it and and it's it's just going to go

down from here and it'll come down and

cover this Gap at $250 in the next

couple weeks or is it going on and I I I

go back to the the earnings call and and

he tells me he's bought two new

companies since January the 1st uh to

help them meet the demand that they're

getting from Big tech and and again he

he he says uh um our our our uh our

precedent right now is good working

conditions for our employees and our

hard workers he said because these

people have been with us for decades and

we want them to be working in good

conditions and we want them to get paid

extremely well because they're they're

uh talented uh workers and then we have

to go out in many communities that were

doing this work in in higher subs and we

got to pay them the top price so we get

best best of price for everything that

we're

doing okay this sounds to me just like

Modine which I did a a u a video on last

week these people are being their doors

are being beat down to say um help us

get this done it's going to take five

years or more um and we need you and

whatever it's going to cost we can pay

it it and we will pay it and you move us

to the front of the line and that's

what's happening with um comfort systems

of USA ticker symbol fix

fix uh I don't know that I have ever

seen anything quite like this before I I

wasn't attune to the build out of um the

internet I don't I I did not I wasn't

aware of that there there is so much

money being thrown around right now to

get this done and get it done as fast as

you can because the profits that we will

be able to make off of it are going to

make the cost that we're spending

insignificant that's what we're looking

at I did a video just uh a short video

just

yesterday on um your future is available

to you if for

$339.99 a month uh and that's that's

that's a high price because these people

are going to deliver you all the

knowledge in the world and they know it

they know that they're going to change

your life they know they're going to

change education they know they're going

to change the medical world they they

know they're going to cure hunger

they're going to cure uh the global

warming they know this and they're

spending in money as fast as they can to

get to where they're going and all the

attention right now is on on Nvidia and

super macro because they are they are

the recipients of the money and and

Jensen and Charles are figures you

recognize but you don't know Brian Lane

you've never heard of him and he right

now is trying he's running as fast as he

can to keep up with this something and

he's no spring chicken um he has never

experienced anything like this in his

life and probably never will but right

now he's captivating on it and I think

you and I should as well okay so we're

ahead of the game um so what do we do

next well I what I do next is I figure

out where is the buyin price what do I

do for that I go back to technicals I

look at at fix and it's got a gap it

today at

$315 it's got a gap all the way down at$

250 uh is it going to go that way it's

it's nday moving uh average is 301 is

that where you buy in it's got a

Fibonacci retracement of 240 what's it

what's its fair fair market Price we got

to do some research and we got to come

up with where is where is this when when

something happens that is negative to

the market where is this going to drop

to um with Modine selling right now at

90 its 50-day moving average is uh

71 its 9 day is uh 89 and its fibon is

65 so this is what I will do next is

figure out where is my buyin opportunity

when when the market gets scared for

whatever reason what's it going to come

into and and where am I going to buy at

it because that's I don't want to buy it

at its peak right now uh so that's what

I do on my cheat sheets and that's where

you come to uh best of us investors you

sign up for our uh Platinum program uh

it's on sale right now at 50% off you

can get the coupon on that in the

description and let's figure out where

do we buy fix where do we buy Modine

because these people are the the the the

the Hammers and the nails and and the

concrete and the and and in the the

sheet metal that are going to build

these massive data centers that

companies like Amazon Google uh

Microsoft and and and um meta have to

have in order to profit off of what they

are going to deliver to us next okay uh

come to the website get on the bus and

let's uh let's make this an opportunity

of a

lifetime