As the head of the Department of Government Efficiency (DOGE), tasked with slashing federal spending, Elon Musk has already slashed thousands of jobs, forcing agencies to justify their budgets or face deep cuts. Additionally, Tesla’s (TSLA) CEO has vowed to trim between $1 trillion and $2 trillion from the annual federal budget by 2026.
Musk’s grip on Washington’s purse strings is not just shaking up bureaucracy, it’s sending ripples through the market, making Musk-linked investments more relevant than ever.
For investors looking to ride this wave, Nvidia (NVDA) and Modine Manufacturing (MOD) stand out.
Nvidia fuels Musk’s artificial intelligence (AI) empire, with xAI’s Colossus supercomputer running on 100,000 Hopper GPUs. Despite volatility, Nvidia remains AI’s gold standard. Meanwhile, Modine, a longtime Tesla supplier, is scaling its thermal management solutions for data centers, tapping into skyrocketing demand. So, with Musk trimming government spending while expanding his economic reach, these two “Strong Buy” stocks could be wise picks for those betting on AI and infrastructure’s future.
Stock #1: Nvidia
Founded in 1993, Nvidia (NVDA) has evolved from a GPU innovator to an AI juggernaut. Now valued at $2.9 trillion by market cap, it dominates data centers, gaming, and pro visualization.
Elon Musk and Nvidia are shaping the AI future together. Nvidia’s chips fuel Tesla’s self-driving ambitions and power xAI’s Colossus supercomputer, set to double to 200,000 Hopper GPUs. With Musk’s AI vision and Nvidia’s tech dominance, their partnership could drive massive gains in autonomous vehicles and machine intelligence, keeping Nvidia at AI’s cutting edge.
Nvidia’s 2025 rally hit a speed bump after China’s DeepSeek shook the AI landscape. A steep 17% drop on Jan. 27 and a post-Q4 earnings plunge spooked investors, but NVDA is starting to rebound. Looking at the bigger picture, NVDA is still up 61% over the past 52 weeks.
NVDA, trading at 32.95 times forward adjusted earnings, may look steep, but for the undisputed AI king, it is a justifiable premium.
Nvidia dropped a stellar Q4 earnings report for its fiscal 2025 on Feb. 26, smashing expectations with $39.3 billion in revenue, up 78% year-over-year. The real star was data center sales, soaring 93% annually to $35.6 billion as AI demand skyrockets. Non-GAAP EPS climbed 71% to $0.89 per share, reinforcing its dominance.
Nvidia’s Blackwell AI supercomputers are rolling out at an unprecedented scale, raking in billions in their first quarter. As AI evolves beyond software into agentic and physical applications, industries from healthcare to robotics are poised for transformation. Nvidia stands at the center of this revolution, fueling AI’s next frontier.
Looking ahead, the tech titan sees no slowdown. Nvidia projects Q1 fiscal 2026 revenue of $43 billion, with non-GAAP gross margins holding at around 71%. With AI accelerating, Nvidia remains Wall Street’s undisputed heavyweight.
Analysts tracking NVDA project the company’s profit to reach $3.98 per share in fiscal 2026, up 35.8% year over year, and grow another 23.6% to $4.92 per share in fiscal 2027.
Overall, NVDA has a solid “Strong Buy” consensus rating, reflecting analysts’ bullishness. Out of the 43 analysts in coverage, 37 recommend a “Strong Buy,” two advise a “Moderate Buy,” and the remaining four are playing it safe with a “Hold” rating.
The AI chip stock’s mean price target of $177.43 suggests that it could rally as much as 35% from the current price levels. The Street-high of $220 – set by Tigress Financial – implies potential upside of 67.6%
Stock #2: Modine Manufacturing
For over a century, Modine Manufacturing (MOD) has been keeping industries cool. Headquartered in Racine, Wisconsin, this thermal management powerhouse engineers cutting-edge cooling solutions for everything from EVs to data centers. With operations spanning the U.S., Europe, and Asia, Modine specializes in heat exchangers, battery cooling, and climate control tech. As demand for high-efficiency cooling surges, Modine’s innovation in thermal systems positions it as a key player in the future of electrification and AI infrastructure.
Modine’s long-standing ties with Tesla began in 2012, supplying battery chillers for the Model S. As Tesla scales EV production and energy storage, Modine’s advanced thermal solutions could see soaring demand, making it a key beneficiary of Tesla’s relentless expansion in electrification.
Valued at a market cap of $4.2 billion, MOD stock has seen its share of turbulence, down 27% this year. But zoom out, and the picture shifts. With a staggering 1,240% gain in five years, this cooling-tech giant is simply catching its breath. After its Feb. 4 earnings, investors are watching for a floor, eyeing the next leg up.
Despite its recent dip, MOD still commands a premium, priced at 22.42 times forward earnings and 1.9 times sales. Its strong fundamentals and sector-leading innovation justify the valuation, signaling resilience and long-term growth potential for patient investors.
Modine turned up the heat, delivering strong Q3 earnings results for its fiscal 2025 on Feb. 4 that sent its stock up roughly 7% the next day. Revenue hit $616.8 million, climbing 10% year-over-year, fueled by booming data center cooling and HVAC and refrigeration products (HVAC&R) sales. Adjusted EPS jumped 24% to $0.92, smashing estimates by 16.5%.
Modine is doubling down on growth, expanding its manufacturing capacity in the Asia-Pacific region – a new production facility in India to meet surging demand for data center cooling and genset modules. With $45 million in free cash flow and a rock-solid 0.8x leverage ratio, the company’s balance sheet is primed for another strong year ahead.
Modine is charging ahead, aiming for a third straight year of record-breaking results. Sales are projected to climb between 6% and 11%, poised to be between $2.55 billion and $2.67 billion, with adjusted EPS anticipated to land between $3.65 and $3.95.
Analysts tracking Modine project adjusted EPS of $3.88 in fiscal 2025, up 19.4% year over year, and climbing further by 21.4% to $4.71 in fiscal 2026.
Wall Street is highly bullish overall, with a consensus “Strong Buy” rating for MOD. Out of the five analysts covering the stock, four recommend a “Strong Buy,” and one advises a “Moderate Buy.”
The average analyst price target of $152.50 indicates potential upside of 75.3%. The Street-high target of $155 suggests that the stock could surge as much as 78.1%.
