One of the hardest stocks to buy is the one you wish you’d bought six months ago.
A share price doubles, investors mentally anchor themselves to the old price, and suddenly every purchase feels like arriving at dinner after dessert has been served. Yet a rising stock isn’t automatically an expensive stock, just as a falling one isn’t automatically cheap. What matters is whether the business underneath the share price is growing fast enough to justify the move.
That distinction looks particularly important right now. Artificial intelligence (AI) is creating an electricity problem alongside all those clever chatbots. The International Energy Agency says data centre electricity demand jumped 17% in 2025, while demand from AI-focused data centres surged 50%. By 2030, global data centre electricity consumption could roughly double from 2024 levels.
That doesn’t just create opportunities for utilities. Before electricity reaches a server rack, an enormous amount of electrical equipment has to make the journey possible. That brings me to a TSX stock investors may regret dismissing simply because it has already run.
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HPS
Hammond Power Solutions (TSX: HPS.A) isn’t exactly the stock people brag about owning at dinner parties. Transformers rarely compete with AI or rockets for conversational excitement. They’re considerably better at moving electricity, though.
Hammond designs and manufactures transformers and other equipment that regulate and distribute electrical power. Its products go into data centres, factories, renewable-energy projects, infrastructure, mining operations, and other facilities where electricity needs to arrive reliably and at the right voltage.
That puts Hammond directly behind several enormous investment trends, including AI infrastructure, grid upgrades, electrification, and industrial expansion. Investors have noticed. Around $243 recently, Hammond shares remain more than 115% above their 52-week low of $111.09, although it has pulled back substantially from their $365.12 high. That decline may actually make the growth story more interesting for investors comfortable buying stocks in Canada.
Playing catch-up
Hammond’s second quarter was difficult to dismiss as enthusiasm alone. Quarterly sales surged 44.7% year over year to a record $324.8 million. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) reached $53.2 million, while adjusted earnings per share (EPS) came in at $2.76. More importantly, backlog was 96.9% higher than one year earlier.
Backlog is essentially work customers have ordered that Hammond stock hasn’t yet completed. It gives investors some visibility into future sales, and almost doubling it while simultaneously shipping record volumes suggests demand hasn’t disappeared just because the stock rallied.
Data centres have been particularly important, especially in the United States and Mexico. That connection could become even more valuable as AI companies race to add computing capacity.
A bigger bet
Hammond stock isn’t simply waiting for transformer demand to grow. In June, the company completed its roughly $365 million acquisition of AEG Power Solutions, expanding into power conversion, critical-power equipment, controls, and services. Hammond stock can now sell customers more of the electrical system rather than supplying one piece of it.
That could broaden its opportunity in data centres, transportation, infrastructure, and energy projects while adding more international exposure. Still, Hammond stock trades around 47 times trailing earnings, which is hardly bargain-bin territory. High-growth expectations are already baked into the price, and any slowdown in data centre investment could punish the shares quickly. That said, it’s not that I wouldn’t buy, I would! Just gradually.
Bottom line
Instead of trying to guess whether $243 becomes $220 before it becomes $300, I’d build the position over time and keep it appropriately sized. Investors can use the same approach during a stock market correction rather than demanding the perfect entry price.
Hammond stock has already produced a spectacular run from its lows. Yet record sales, nearly doubled backlog, data centre demand, and a larger addressable market after the AEG acquisition suggest the business itself is still expanding.
Sometimes a rally means you’ve missed the opportunity. Yet other times, it’s simply the market noticing the opportunity before everyone else has finished doing the math.
