Research from Water Tower Research, Water Tower Research

Water Tower Research

Research from Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

Equity Research Firm

Thematic (Sector/Industry)

<div><ul><li>Water Tower AI Flow Index. We monitor ~400 public companies across tech and AI for performance and AI-related news flow.</li><li>Last month (ending 3/31), the WTR AI Index was down 5.5% M/M versus the S&amp;P 500 Index (down 5.1%), the Russell 2000 Index (down 5.2%), and the Nasdaq Index (down 4.9%).</li><li>All sectors, with the exception of Internet and Data Services, were down M/M; Software, while still down M/M, was not down as much as other sectors. </li></ul></div>

Water Tower AI Flow Index. We monitor ~400 public companies across tech and AI for performance and AI-related news flow.Last month (ending 3/31), the WTR AI Index was down 5.5% M/M versus the S&amp;P 500 Index (down 5.1%), the Russell 2000 Index (down 5.2%), and the Nasdaq Index (down 4.9%).All sectors, with the exception of Internet and Data Services, were down M/M; Software, while still down M/M, was not down as much as other sectors. 

AI Flow Index : Sailing a Sea of Companies in AI - 2 April 2026

<ul><li>Setting up to be a crucial quarter for the major cloud infrastructure providers and broader tech as investors focus on the cost/benefits of AI.</li><li>Over the last decade, AMZN, MSFT, and GOOGL have garnered outsized investor attention, in part due to their size, but equally due to each of their rapidly growing tech infrastructure businesses (AWS, Azure, and GCP, respectively).</li><li>Based on the capex commentary from all three exiting the December quarter, investors are hoping for early signs of business AI traction, but also bracing for greater clarity around the costs.</li></ul>

Setting up to be a crucial quarter for the major cloud infrastructure providers and broader tech as investors focus on the cost/benefits of AI.Over the last decade, AMZN, MSFT, and GOOGL have garnered outsized investor attention, in part due to their size, but equally due to each of their rapidly growing tech infrastructure businesses (AWS, Azure, and GCP, respectively).Based on the capex commentary from all three exiting the December quarter, investors are hoping for early signs of business AI traction, but also bracing for greater clarity around the costs.

Cloud Infrastructure Monitor - Upcoming Earnings Season Marks a Crucial Point for Sector and AI

United States

Digitalocean Holdings, Inc. operates as a holding company. The Company, through its subsidiaries, provides on-demand infrastructure and platform tools for developers, start-ups, and small and medium-sized businesses to build, deploy, and scale software applications. Digitalocean Holdings serves customers worldwide.

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Digitalocean Holdings (DOCN US)

AI Flow Index : Sailing a Sea of Companies in AI - 2 April 2026

Last month (ending 3/31), the WTR AI Index was down 5.5% M/M versus the S&P 500 Index (down 5.1%), the Russell 2000 Index (down 5.2%), and the...

Water Tower Research

Cloud Infrastructure Monitor - Upcoming Earnings Season Marks a Crucial Point for Sector and AI

Setting up to be a crucial quarter for the major cloud infrastructure providers and broader tech as investors focus on the cost/benefits of AI.

Water Tower Research

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