AI gold rush fuels megaport and codan share surges

Megaport’s six-month, 204% share-price surge into September 29, 2026 was not a speculative burst detached from fundamentals; it was repeatedly tied to contract-led evidence that investors were starting to value the company as an AI infrastructure enabler. The Motley Fool Australia captured that shift early with the headline, “Megaport Shares Rocket 75% After $254M AI Contracts, Analysts Predict Up to 90% More Upside,” establishing a direct market link between AI-related deal flow and the stock’s re-rating as demand for connectivity around AI workloads became more visible.

By early September, that recognition had broadened into a more durable business-model thesis: The Motley Fool Australia said Megaport’s improved FY27 outlook was “helped by the Latitude.sh acquisition and the expansion of Megaport's compute business alongside its existing network operations,” while “3 major contracts worth a combined $506 million” were expected to add “around $129 million in annual recurring revenue.” That helps explain why the stock “traded below $7 in April,” then “surged past $20,” hit a “52-week high of $22.98,” and still carried “9 buy ratings and no holds or sells” on TipRanks despite later easing to $16.93.

The market is repricing digital infrastructure because AI buildout is forcing a large increase in data center, compute, and connectivity spending across the sector. Earlier, ASX tech was punished on fears that high share price valuations and massive AI investment in the US may create an AI bubble, with some comparing it to the late-1990s internet boom. Investors then began separating speculative software risk from the physical stack AI needs, and data centres, power grids, and networks in Australia became the visible bottlenecks and beneficiaries of deployment. Connectivity providers such as Megaport were also pulled into the infrastructure trade.

That shift is backed by capacity and financing signals. NextDC said contracted utilisation surged 60% to 667MW in the March 2026 quarter, driven by AI workloads requiring intensive computing power, storage, and connectivity, with contracted EBITDA expected to exceed A$1 billion as capacity converts through FY30. Goodman said data centres were 73% of its development pipeline, on track to reach $18 billion, backed by a 6.4-gigawatt power bank, while Amazon’s $17.5 billion AI data-centre loan showed dedicated infrastructure debt is expanding. Megaport added four new AI infrastructure contracts worth $458.9 million, including $254 million in new AI contracts.

Codan helps confirm that investors are not only chasing pure-play AI names but also rewarding infrastructure-linked communications exposure. The Motley Fool Australia captured that shift in the headline “Codan Hits Record $51.64 as Communications Revenue Jumps 22% and GPZ8000 Detector Launches,” then noted that “Wednesday gave shareholders another reason to be pleased, with the tech company's shares climbing to a new all-time high of $53.16… finishing the session up 3.37% at $53.10,” a price response tied to communications growth rather than a direct AI-compute contract story. Even so, investors were willing to back that momentum despite valuation and income settings that looked far from bargain-basement, with Codan reported as having a “P/E is 54.48,” “reported earnings per share of 0.959,” a “current yield of 0.93%,” and “100% franking.”

The operational case for that rerating is equally clear: “Its communications division delivered revenue of $506.2 million, up 22%, with segment profit climbing 45% to $156 million,” while “Demand for unmanned radio systems has been particularly strong, with revenue from this market more than doubling to approximately $215 million.” The Motley Fool Australia said Codan expects “another strong year,” with communications revenue growth of about 20% in FY27, and by 25 September 2026 the stock had “closed at $52.25” after an “85.5% year-to-date return,” despite already trading on a “P/E is 54.48.”