Over the past decade, the internet has shifted from a convenience to a cornerstone of modern life.
And now, with artificial intelligence (AI), cloud computing, and data-driven services accelerating rapidly, one thing is certain — data centres are becoming some of the most valuable infrastructure assets on the planet.
For ASX investors wondering how to tap into this megatrend, one ASX 200 stock stands out: NextDC Ltd (ASX: NXT).
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The backbone of digital transformation
NextDC operates a nationwide network of Tier III and Tier IV certified facilities, offering critical infrastructure to support Australia's digital economy. The ASX 200 stock specialises in colocation services — essentially, housing the computing and networking gear that powers everything from cloud platforms to apps.
Its customers include some of the world's largest technology firms, and its ecosystem of more than 750 cloud, network and IT service providers makes it a central hub for digital connectivity.
What makes NextDC particularly compelling is its position as an independent provider, unaligned with any single cloud giant. That neutrality allows it to service a wide range of clients across industries, many of whom require secure, low-latency and scalable environments for their infrastructure.
AI boom
As generative AI models grow larger, and as more businesses shift to hybrid cloud models, demand for secure and scalable data storage and compute capacity is set to soar.
Whether it is training AI, running financial algorithms, hosting video content, or supporting e-commerce — it all needs powerful, connected infrastructure. That's exactly what NextDC builds and operates.
The ASX 200 stock's recent builds, such as its S3 facility in Sydney and M3 in Melbourne, are designed to support hyperscale tenants and high-density workloads. These aren't just data warehouses — they're mission-critical digital factories powering the next phase of the economy.
Its next facilities in these markets, S4 and M4, are currently under development and look set to strengthen its competitive position.
Should you buy this ASX 200 stock?
The team at Morgans is very positive on this ASX 200 stock.
So much so, it recently put a buy rating and $18.80 price target on NextDC's shares. Based on its current share price, this implies potential upside of 37% for investors over the next 12 months.
Commenting on its bullish view of the stock, the broker said:
NXT has announced its first international cornerstone customer who has signed a 10MW deal in NXT's upcoming Malaysian site (Kuala Lumpa/KL1). KL1 goes live early calendar year 2026. It's pleasing to see customer demand before go-live. The deal is significant as the first reference point with a Hyperscaler contractually validating NXT's international expansion plans. We retain our Buy recommendation and $18.80 target price.
All in all, this could make this ASX 200 stock one to consider for exposure to the data centre boom.
