If you have been trying to find a fundamentally solid stock capable of delivering life-changing returns, you’re not alone. But the problem is that most companies promising explosive growth often come with high risks, weak fundamentals, or uncertain business models. That said, it’s not impossible to find a stock operating in the right industry at the right time, backed by strong demand trends and strong execution.
In recent years, growing investment in electrification, renewable energy infrastructure, and artificial intelligence (AI)-driven data centres has created massive demand for electrical equipment and power infrastructure solutions. As industries continue modernizing and expanding globally, companies supplying critical electrical components could see years of strong growth ahead.
And one Canadian industrial stock that has quietly emerged as one of the market’s strongest long-term performers is Hammond Power Solutions (TSX:HPS.A). After a massive rally over the last year, many investors are wondering if this growth stock still has room to run.
In this article, I’ll explain why Hammond Power stock could remain a high-potential long-term investment.
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HPS stock has delivered explosive gains
If you don’t know it already, Hammond Power Solutions is a Canadian manufacturer of dry-type transformers, power quality products, and related electrical equipment used across industrial, renewable energy, infrastructure, and data centre applications.
HPS stock recently closed at $337.16 per share with a market capitalization of roughly $3.1 billion. Over the last year alone, the stock has skyrocketed by an impressive 243%. Even more remarkably, it has surged nearly 3,100% over the last five years.
Much of this momentum has been driven by strong financial growth, rising demand tied to electrification trends, and the company’s growing exposure to data centre infrastructure projects. But this isn’t just market hype. Hammond Power Solutions continues to deliver record financial results while expanding its manufacturing capacity to support future demand.
Let’s take a closer look.
Data centre demand is becoming a major growth driver
One of the company’s biggest strengths right now is its growing exposure to AI-driven data centre expansion. As AI adoption accelerates globally, the need for large-scale data centres and reliable electrical infrastructure is rising rapidly.
In the first quarter of 2026, Hammond Power Solutions posted record quarterly sales of $265 million, reflecting a strong 31.5% year-over-year (YoY) rise. The company highlighted strong growth in custom transformer shipments tied to data centre-related projects.
Its backlog also jumped by an impressive 94.6% YoY, largely due to large projects linked to data centre activity. A growing backlog is important because it gives investors better visibility into future revenue growth.
The company also noted that its new manufacturing plant in Mexico began shipping products during the quarter, helping support higher production volumes and future growth opportunities.
Strong financial growth reflects improving operations
In the latest quarter, its adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) rose 32.8% YoY to $41 million. At the same time, its adjusted earnings climbed 29.7% from a year ago to $2.08 per share despite ongoing tariff-related cost pressures.
The company also improved its gross margin to 30.1% from 29.2% in the previous quarter as pricing improvements and better factory utilization supported profitability.
More importantly, Hammond Power Solutions operates manufacturing facilities across Canada, the United States, Mexico, and India. This diversified manufacturing footprint could help the company better manage supply chains and support global customer demand over the long term.
Could HPS stock become a millionaire-maker investment?
The long-term growth opportunity for Hammond Power Solutions extends beyond data centres. As governments and businesses continue investing in renewable energy projects, electrical grids, electric vehicle infrastructure, and industrial modernization, demand for transformers and power quality products could continue rising consistently for years.
Of course, after such a massive rally, volatility is always possible. But for investors seeking exposure to electrification, infrastructure growth, and AI-related demand trends, HPS stock still appears to have solid upside potential.
