The Quiet Winner
Infrastructure has become one of the sneakiest winners of the AI cycle. The demand for data centers, power generation, and the transmission lines to feed them has turned a sleepy corner of the market into a growth story, and the companies that build and own that physical backbone have been rewarded for it.
Michael Brush’s first pitch for Cabot Insider Edge, “I Just Found the 3 Stocks Behind $11.3 Million in Insider Buying,” reaches into that trade. One of the three picks is Cardinal Infrastructure (CDNL), a Southeast construction-services rollup that the promo positions as a data-center and infrastructure builder. It is the infrastructure name of the trio, and it shows both the promise and the volatility of this corner of the market.
What Infrastructure Actually Means Here
The label covers a lot of ground. There are the utility owners, the power producers, the pipeline operators, and the energy-infrastructure companies that move fuel and electricity around. Then there are the builders, the contractors and engineering firms that pour concrete and lay steel for everything from highways to hyperscale data centers.
Cardinal sits on the builder side. It is vertically integrated, meaning it keeps the full chain of construction work in house. The promo compares it to Sterling Infrastructure, the data-center builder that has been one of the sector’s clearest winners, and to Construction Partners, a regional rollup in the same geography. The comparison flatters Cardinal, because its actual revenue mix is more residential and commercial than the data-center halo implies.
The Insider Signal
The whole promo hangs on insider buying, and the infrastructure name carries the biggest chunk of it. Insiders bought about $8.1 million, with the real total north of $9 million, and the centerpiece is a roughly $3 million purchase by the CEO against a $450,000 salary.
That is cluster buying in its purest form: C-suite executives paying market prices out of their own pockets. The research on this kind of signal points to a modest edge, around 3% to 5% of outperformance over six to twelve months. It is not a sure thing, but it is a real data point, and it carries more weight than a single token purchase.
The Volatility Problem
Infrastructure builders are supposed to be steadier than tech, but Cardinal has been anything but. The stock went public in December 2025 at $21 a share, ran to a June high, then fell roughly 50% after the six-month lockup expired, a $320 million raise priced at $73 a share, and an August 11 quarter that beat on revenue but missed on earnings and margins. The shares slid from the $90s into the $30s, closing near $36.98 on August 31.
That is the reminder buried in the infrastructure story: the builders are more leveraged to the spending cycle than the asset owners are. A utility with a regulated rate base grinds higher year after year. A construction rollup can double and halve in a single year when financing conditions shift. The promo’s growth numbers, earnings up 114%, backlog up 35%, and 95% revenue guidance, are real, but they did not prevent the drawdown.
The Structure Beneath the Story
There is a structural wrinkle worth knowing before you trust the valuation. Cardinal is dual-class. The founder and family hold about 27.5 million non-traded Class B shares plus roughly 20 million trading Class A shares. Consolidated net income comes in near $37 million, but only about $18 million is attributable to common shareholders.
That gap matters because the promo leans on an 18-times-forward-earnings multiple, which looks cheap next to Sterling Infrastructure at around 20 times. But the multiple is priced off the Class A slice, not the full consolidated profit. The company-specific breakdown walks through the numbers, and the broader construction trade shows how common this founder structure is in the rollup space.
Where It Fits
The infrastructure trade has real legs. Spending on power, transmission, and data centers is not slowing down, and the energy-infrastructure angle is its own growing story. The question with Cardinal is whether a housing-and-commercial builder deserves to trade on the same tailwind as a true data-center contractor.
The answer matters for how much you pay. A pure infrastructure builder with genuine data-center backlog can justify a premium. A rollup that mostly builds homes in the Southeast is a different bet wearing the same costume.
The Verdict
Infrastructure stocks are a real winner in this cycle, but not every infrastructure label is the same thing. Cardinal’s insider buying is genuine and sizable, and the category tailwind is real. The catch is the dual-class structure and a revenue mix that is more housing than hyperscale, which is exactly the kind of gap worth checking before you buy.
Ready to see the research? Click here to access Michael Brush’s report.
NewsletterVetter is an independent publication. We receive compensation from some of the services we review through affiliate links. Nothing on this site is investment advice. Always do your own research.