Where Natural Gas Meets AI
The AI boom is, at the bottom, an electricity problem. Training and running large models takes enormous amounts of power, and data centers need that power delivered on a timeline the grid cannot always meet. The fastest answer is a gas turbine, a machine that can be installed and fired up in months rather than the years a new plant or transmission line takes. That simple fact is why gas turbine makers have gone from sleepy industrial names to companies investors watch closely.
This is the tailwind tucked inside Rob Spivey’s “The #1 Oil Income Play of 2026” pitch. The stock he teases is Baker Hughes (BKR), and the part of the business the promo really cares about is not oil at all. It is the company’s turbine franchise.
Who Makes the Turbines
The public turbine field is dominated by a handful of names. GE Vernova is the heavyweight, the power-generation business spun out of General Electric, with the broadest lineup and the service contracts utilities and large operators buy. Siemens Energy sits alongside it as a major supplier, particularly strong in Europe and in large-frame turbines.
Baker Hughes occupies a slightly different corner. Its industrial and energy technology segment makes the turbines, compressors, pumps, and valves that serve oil and gas customers first, but the same hardware crosses over into power generation. The company is winning turbine orders tied directly to AI-driven electricity demand, which is why the pitch frames a services giant as an AI power play.
Why the Turbine Orders Matter
For Baker Hughes, the turbine story changes the growth math. Its traditional oilfield services business rises and falls with the energy spending cycle, but turbine orders for electricity generation are a secular demand story, driven by data-center buildouts that do not care about the price of crude. Orders across the company jumped 29 percent in the second quarter of 2026, and management raised its revenue target to almost $7 billion, a signal that the crossover demand is real rather than theoretical.
Our natural gas stocks explainer covers the fuel side of that equation, and our oil and gas equipment companies piece details the hardware that crosses over into power generation.
What Moves the Group
Turbine makers are cyclical at heart. When order books fill, margins expand and the stocks re-rate; when the cycle pauses, the air comes out quickly. The AI demand story is powerful, but it is layered on top of a business that still lives and dies by large, lumpy equipment orders. A single delayed project can move a quarter.
For Baker Hughes specifically, the valuation already reflects some of the optimism. The stock trades around 22 times forward earnings, versus roughly 13 times for Halliburton and 18 times for Schlumberger, even though all three carry similar analyst growth forecasts. You are paying up for the turbine angle before the full benefits show up in the income statement.
The Order-to-Revenue Lag
Turbine businesses have a rhythm worth understanding, because it explains both the upside and the risk in the pitch. A turbine order is a commitment to build and install a large, complex machine over months or years, and the revenue shows up long after the order is signed. When Baker Hughes reports a 29 percent jump in orders in a single quarter, as it did in the second quarter of 2026, the earnings benefit from that jump is still mostly ahead of it, not behind it.
That lag is why the market is willing to pay up today for orders that will convert to revenue later. It is also the source of the risk. If the orders stop coming, the stock can fall before the income statement shows any weakness, because investors are pricing the future order book, not the current one. Management’s move to raise the revenue target to almost $7 billion is a statement of confidence in that conversion, but it is still a forecast rather than a result.
The Cyclical Core That Remains
It is easy, reading the AI power pitch, to forget that Baker Hughes is still, at heart, a cyclical oilfield services company. Its services business rises and falls with oil and gas spending, and roughly three-quarters of that business sits outside North America. The turbine story is real, but it is layered on top of a core that will still feel the next commodity downturn.
For an investor, that means the pitch asks you to pay a growth multiple, around 22 times forward earnings, for a company whose largest business is still tied to the oil cycle. The turbine angle improves the growth outlook, but it does not remove the cycle.
The Bottom Line
Gas turbine stocks sit at the intersection of two big themes: the world’s ongoing need for reliable power and the specific urgency of the AI buildout. Baker Hughes earns its place in that conversation through its energy technology segment, not through its dividend, which sits near 1.5 percent. Whether the premium is justified is the real question for anyone chasing the pitch.
Ready to see the research? Click here to access Rob Spivey’s report.
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