Citi Analyst With 80% Success Rate Calls an Overlooked AI Stock

Bel Fuse (BELFB) is up about 57% this year, yet it remains an overlooked AI stock almost no one is searching for, even as one of Citi’s best-performing analysts just told clients to buy more.

That gap between Wall Street’s conviction and the public’s attention is the story. Ultimately, it sits in a quiet corner of the AI trade, the parts inside data centers.

The Analyst Behind the Call

Specifically, the call comes from Asiya Merchant, Citi’s IT hardware lead. On July 13, she initiated coverage with a Buy and a $325 target, about 22% above the recent price near $266.

Her record is why it matters. Merchant has been right on roughly 82% of her ratings, 154 of 188, with an average return near 88% per call, among the strongest on Wall Street.

So when she flags a small, unloved name, it carries weight, and it is a name she covers as a data-center derivative.

Six Analysts, and Everyone Says Buy Bel Fuse

Merchant is not alone. All six top analysts covering Bel Fuse rate it a Buy, with an average target near $316, and coverage jumped from 6 to 9 analysts in about 6 weeks. Bank of America initiated coverage with a Buy rating on July 14, and the stock climbed on the news.

However, the targets sit only about 20% above the price.

Still, that modest upside on a stock already up big signals conviction in the business, not a lottery ticket, even as it makes July’s watch list of US stocks elsewhere.

Why an AI Boom Reaches a Parts Maker

To be clear, Bel Fuse is no AI pure play. It is a Nasdaq-listed electronic-components maker, and its AI angle is an extension of a core business in power, protection, and connectivity, the parts that data centers happen to need.

Here is the connection. Bel Fuse makes the power conversion, circuit protection, and connectivity parts that sit inside data centers, the unglamorous hardware every AI server needs.

It rarely supplies the tech giants directly. Instead, its parts flow through the server and networking makers that fill those data centers.

That demand rides on hyperscaler capital spending. Google alone just guided its 2026 data-center budget toward $190 billion, so as the giants build, component suppliers sell more. Bel Fuse’s data segment grew about 14% last quarter, and its backlog rose 21%, with real orders behind the story.

Meanwhile, all that data-center construction is straining the power grid. Grid operator PJM projects 32 gigawatts of new peak demand through 2030, almost all of it from data centers, a multiyear buildout of power and connectivity.

As a result, investors already group Bel Fuse with power names like Eaton and Amphenol inside an electrification-focused ETF, treating it as a picks-and-shovels play on that trend.

The timing helps, too. The broad AI trade has narrowed lately, and the Power and Infra layer where Bel Fuse sits has cooled.

Yet fresh capex guidance could pull money back to it.

The Overlooked AI Stock Nobody is Searching

Now the twist. Even as the stock nears records and analysts pile in, public interest has faded to near a yearly low, and next to Nvidia its search interest reads zero all year.

The options market is bracing all the same. Meanwhile, implied volatility sits in the 98th percentile of its past year, a sign traders expect a large move. Notably, Bel Fuse reports second-quarter earnings on July 29.

However, the valuation is the risk. Bel Fuse trades at a price-to-earnings ratio near 55, meaning investors pay about $55 for every $1 of yearly profit, so a lot of growth is already priced in.

That makes the July 29 earnings the test to watch. If margins and the data-center backlog keep rising, the crowd may again start noticing this overlooked AI stock. But if they slip, that rich price leaves a long way to fall.

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