New Ask Claude or ChatGPT about any stock, using Bullpen. Bullpen in Claude or ChatGPT. 7 days free
Bullpen.News From Edwin Dorsey
Get Daily Recap Feedback

Tuesday, November 10, 2026

Back to the front page

From X

@kevin__mak

Kevin Mak on X

The post below dovetails into my view on "powered shells" or essentially the utility companies of the AI trade ($CORZ, $RIOT, $WULF, etc.) These companies largely (or entirely) own no GPUs. They lease a building with electricity/cooling/infrastructure to the hyperscalers/neoclouds/AI labs, who bring in their GPU racks/fiber and run their datacenters. They're the bottom ~$1 of the "per GPU hour" value chain. They're essentially real estate/utility company plays where they collect pre-specified rent for a very long time. As far as I can see, the only real downside that these companies face is that their tenants go bankrupt, AND nobody else takes over the lease/continues running the datacenter. In other words, datacenters "go dark" due to overbuilding. In my opinion, this is exceptionally unlikely. The cost of running these facilities is exceptionally small relative to the neocloud or "frontier model" pricing. If margins ever compress, it should come out of the "top of the stack" way before it comes out of anywhere else. In a world where there's an overbuild of datacenters, and datacenters are literally dark, it also means new ones aren't being built. That means GPUs and memory and all that infra are no longer being sold, because it's way easier to turn on a dark datacenter than it is to build a new one. If new datacenters aren't being built, most of the semi/hardware industry is also dead. These powered shells are occasionally trading below their contracted value, never mind adding the terminal value of their buildings and the option value of their expansion capacity. I think the reason why they're trading down so hard lately is because they're "correlated to the AI trade". But the mistake the market is making is that their operations are much less risky than the rest of the "AI trade" stack. The heroic assumption for current pricing isn't "industry grows at 50% yoy", or "margins stay >40%". It's just "datacenters don't go dark", which is a very low bar. I own $CORZ and $RIOT because I think you're getting pretty close to a free call option on AI growth. As long as these datacenters don't go dark, I think you make your money back plus a small/reasonable return (depending on your assumptions). If the AI sector grows and leases more power, renews leases, etc., then these companies will benefit. Disclosure: Creek Drive and its affiliated funds holds long positions in RIOT and CORZ. Views expressed are current opinions for information only, subject to change and are not investment advice or a recommendation to buy or sell any security. Investing involves the risk of loss and past performance is not indicative of future performance. See the disclosures link in my bio for more important information.

Investor Letters

All letters

STRL: 80 new electricians a week

Sterling’s $4.1 billion backlog faces Texas permitting risk after a governor proposed a moratorium, while Connexion, Capital Asset Planning…

STRL $7.6B
Trade Ideas Flow 1 click

Roblox: Capture This Moment

Roblox’s Q3 FY26 DAUs fell year over year for the first time, while bookings declined 12% to $1.7 billion.

RBLX $35B
TSOH Investment Research 1 click

DoorDash and Google

DoorDash and Google.

DASH $79B
Stratechery by Ben Thompson – On the business, strategy, and impact of technology. 4 clicks

Axon 3Q26 Business Update

Axon cut full-year guidance after delayed federal Dedrone contracts slowed 3Q revenue growth to 28%, while software and services grew 43%.

AXON $31B
Speedwell Memos 4 clicks

AMD Q3 FY26, Annotated

AMD's Q3 revenue rose 45% to $13.4 billion as data center reached $8.5 billion, 64% of sales, driven by EPYC and Instinct ramps.

AMD $660B
Chipstrat 2 clicks

Publications we follow

Every publication on this site, hand-picked.

129 publications

Newsletters 109

YouTube 4

Blogs 15

Seeking Alpha 77 of 281

Nominate a publication

X accounts we follow

Every account on this site, hand-picked.

91 accounts
Nominate an account

Investor letters we follow

360 firms

Sectors

Ordered by how often our editor reaches for them.