Bull of the Day: Fabrinet (FN)

Fabrinet FN is a Magnificent 7 crushing behind-the-scenes technology company that’s playing an increasingly critical role in AI data centers and beyond.

FN stock broke out to all-time highs in the second half of February after posting another beat-and-raise quarter at the start of the month, helping it earn a Zacks Rank #1 (Strong Buy).

The contract electronics manufacturer builds complex, high-precision optical and electronic parts for big tech companies, including Nvidia.

Fabrinet stock has skyrocketed 190% over the past 12 months, part of a 2,000% rally over the past decade that more than quadrupled the Tech sector. FN is projected to post strong double-digit sales and earnings growth in 2026 and 2027 as the AI capex boom continues to heat up.

Investors looking to buy a high-flying, under-the-radar AI and growth tech stock right now and to start March should consider Fabrinet—Wall Street already loves it, and Nvidia and Amazon trust the optical manufacturing powerhouse.

Best Soaring AI Stock to Buy Now: Fabrinet

In its own words, Fabrinet is a “trusted manufacturing partner of the world’s most demanding OEMs.” FN works with technological leaders across aerospace, industrials, medical, life science, optical electronics, and beyond. The company also offers applied technologies such as precision electro-mechanical and electro-optical assembly, sensor manufacturing, and advanced packaging.

Simply put, Fabrinet is a critical high-tech manufacturing company that helps big tech companies, including Nvidia, by making small, precision parts used across AI data centers, telecom, and beyond.

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Overall, Fabrinet is a best-in-class contract electronics manufacturer that does the high-skill factory work needed to create complex, cutting-edge tech for big companies such as Nvidia NVDA.

Fabrinet's behind-the-scenes offerings are becoming more critical by the day as AI hyperscalers and others race to build more data centers. For instance, some of FN's tech is used in data centers to help send information at lightning speeds, enabling AI programs to run smoothly.

Nvidia is one of Fabrinet’s largest clients. The AI chip powerhouse reportedly accounted for roughly 28% of Fabrinet’s FY25 sales. Networking equipment giant Cisco Systems and optical components standout Lumentum are two of its other most important clients.

On top of working with powerhouses such as Nvidia and Cisco, Fabrinet and Amazon AMZN entered an agreement last March that helps Fabrinet tap into Amazon's booming demand for fast, reliable optical networking gear to handle AI workloads.

The AI and Tech Manufacturer’s Growth Outlook

FN grew its revenue by 19% in fiscal 2025 (period ended in June 2025), following a stretch of 13% average sales expansion in the previous six years. The tech company expanded its GAAP earnings by an average of 25% in the past five years.

Fabrinet topped our Q2 fiscal 2026 earnings estimates on February 2, providing upbeat guidance once again that helps it earn a Zack Rank #1 (Strong Buy). The recent upward revisions are part of a steady climb over the past several years.

FN is set to ride the AI arms race and benefit directly from the increased AI-focused capex in 2026.

Despite some AI bubble worries, the spending spree is only heating up. AI chip manufacturer Taiwan Semi TSM was the first big tech firm to raise its 2026 capex guidance back in early January to between $52 billion and $56 billion, blowing away 2025’s $40.9 billion.

AI hyperscalers are projected to spend roughly $530 billion in capex this year, up from around $400 billion in 2025 as Meta and many other Mag 7 companies ramp up their AI efforts. Nvidia on Wednesday was the latest, and perhaps the most important, tech company to confirm that the AI spending boom remains in full force.

Looking ahead, Fabrinet is expected to grow its adjusted earnings by 34% in FY26 and another 19% in FY27 to extend its strong run of earnings growth.

FN is projected to expand its revenue by 33% in FY26 and 19% next year to climb from $3.42 billion in FY25 to $5.39 billion—more than doubling its FY23 total.

Why This Picks-and-Shovels AI Stock Is a Must-Buy

Fabrinet stock has soared ~5,600% since its 2010 IPO, leaving Tech’s 900% run in the dust. FN’s 2,050% charge in the past 10 years helped it outclimb five of the Mag 7 stocks, trailing only Tesla and Nvidia.

The leading contract manufacturer has climbed 400% in the past three years and roughly 190% in the past 12 months.

FN’s recent charge over the last week-plus helped it post multiple new all-time highs, surpassing its December peaks and breaking out of a trading range it had been stuck in for the last several months.

FN's proximity and direct connection with Nvidia, Amazon, and other big tech standouts will be beneficial as they lead the AI arms race.

Plus, Fabrinet is a well-run company with a stellar balance sheet and soaring shareholders' equity, which is something Wall Street craves. Speaking of, eight of the 10 brokerage recommendations Zacks has are “Strong Buys.”

The stock might be a bit overheated in the short run. But market timing is no easy task. And Fabrinet plays a critical behind-the-scenes role in the AI revolution that is likely to be measured in decades. 

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This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research