Early signs indicate that Nvidia's Blackwell GPUs are going to be a big winner for the company.Believe it or not, Nvidia was once a company primarily focused on the gaming market. But over the last two years, the company has emerged as the world's preeminent AI operation. How did that happen?Well, one of Nvidia's core products is an advanced chipset known as a graphics processing unit (GPU). GPUs are a critical piece of infrastructure in developing generative AI, and they've become a business worth tens of ...

I believe Vertiv Holdings (NYSE: VRT ) represents a compelling investment opportunity in the rapidly expanding digital infrastructure sector. In my opinion, Vertiv is exceptionally well positioned to capitalize on three major tailwinds: the explosive growth in AI-driven data centerWe bring a rigorous research-driven approach to uncovering high-conviction stocks with compelling growth potential across dynamic sectors like big tech, semiconductors, AI, and healthcare. Leveraging comprehensive sector insights, ...

Core Insights - Vertiv Holdings (VRT) is experiencing growth in revenue, profits, and customer activity due to the ongoing boom in artificial intelligence [1] Financial Performance - The company is reporting increases in revenue and profits, indicating strong financial health [1] Market Activity - There is a notable rise in customer activity, which suggests a positive market response to the company's offerings amid the AI boom [1]

Investment Rating - The investment rating for Vertiv (VRT) is maintained at "Buy" with a target price of $131, indicating an expected return of over 20% within the next six months [1]. Core Insights - Vertiv reported Q3 FY24 revenue of $2.07 billion, a year-on-year increase of 19%, surpassing Bloomberg consensus expectations of $1.98 billion. Product revenue was $1.65 billion, exceeding expectations of $1.60 billion, while service revenue reached $420 million, above the expected $390 million. The growth was primarily driven by favorable shipment arrangements in the Americas and EMEA regions [1]. - The company raised its full-year revenue guidance from $7.67 billion to $7.81 billion, with organic growth rate guidance increased from 13% to 14%. Adjusted operating profit guidance was raised from $1.435 billion to $1.485 billion, and adjusted diluted EPS guidance was increased from $2.50 to $2.68 [1]. - The company highlighted strong demand indicators, with organic orders growing 17% year-on-year in Q3, and backlog orders increasing by 47% to $7.4 billion [1]. Summary by Sections Financial Performance - Q3 revenue was $2.07 billion, up 19% year-on-year, with a 19% organic growth rate, surpassing expectations [1]. - Operating profit was $380 million, a 47% increase year-on-year, exceeding expectations of $360 million [1]. - GAAP net profit was $180 million, below the expected $220 million [1]. Regional Performance - Americas Q3 revenue was $1.20 billion, with an organic growth rate of 21% and an adjusted operating margin of 25.3% [1]. - EMEA revenue was $440 million, with an organic growth rate of 25% and an adjusted operating margin of 25.9% [1]. - APAC revenue was $430 million, slightly below expectations, with an organic growth rate of 10% and an adjusted operating margin of 10.2% [1]. Business Dynamics - The company anticipates a coexistence of liquid cooling and air cooling technologies, projecting a market share of 70% for air cooling and 30% for liquid cooling [1]. - Capital expenditures for Q3 were $36 million, with a total of $106 million for the year, and a planned capital expenditure of around $200 million for 2024 [1]. - Cash and cash equivalents stood at $910 million, with a strategic focus on mergers and acquisitions rather than reducing financial leverage [1]. Q4 Guidance - Q4 revenue midpoint is projected at $2.14 billion, slightly below expectations, with an organic growth rate forecasted at 13% [1]. - Adjusted operating profit midpoint is expected to be $440 million, with an adjusted operating margin of 20.4% [1]. - Adjusted diluted EPS is projected at $0.82, in line with expectations [1].

Parkev Tatevosian, CFA has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Parkev Tatevosian is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool. ...

When it comes to short-term investing or trading, they say "the trend is your friend." And there's no denying that this is the most profitable strategy. But making sure of the sustainability of a trend to profit from it is easier said than done.Often, the direction of a stock's price movement reverses quickly after taking a position in it, making investors incur a short-term capital loss. So, it's important to ensure that there are enough factors -- such as sound fundamentals, positive earnings estimate rev ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly period ended September 30, 2024 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __to__ Commission File No. 001-38518 Vertiv Holdings Co (Exact name of registrant as specified in its charter) Delaware (State or other jurisdiction of incorporatio ...

Vertiv Holdings (VRT) reported third-quarter 2024 non-GAAP earnings of 76 cents per share, beating the Zacks Consensus Estimate by 7.04%. The figure jumped 46.2% year over year.VRT’s earnings beat the Zacks Consensus Estimate in the trailing four quarter, which is commendable.Find the latest EPS estimates and surprises on Zacks Earnings Calendar.Net sales increased 19% year over year to $2.07 billion, surpassing the Zacks Consensus Estimate by 4.64%. Net sales on an organic basis increased 19.2% year over y ...

Core Viewpoint - Wall Street analysts' recommendations significantly influence investor decisions, particularly regarding Vertiv Holdings Co. (VRT), which currently has an average brokerage recommendation (ABR) of 1.00, indicating a Strong Buy [1] Brokerage Recommendation Trends for VRT - Vertiv's ABR is based on 12 brokerage firms, all of which have issued Strong Buy ratings, resulting in a 100% consensus for buying the stock [1] - Despite the strong ABR, studies indicate that brokerage recommendations often lack success in guiding investors towards stocks with the highest price increase potential [2] - Brokerage analysts tend to exhibit a strong positive bias due to their firms' vested interests, with five Strong Buy recommendations for every Strong Sell recommendation [2] Zacks Rank and Its Importance - Zacks Rank categorizes stocks into five groups, from Strong Buy to Strong Sell, and is based on earnings estimate revisions, making it a reliable indicator of near-term stock performance [3][5] - The Zacks Rank is distinct from ABR, as it is a quantitative model that reflects earnings estimate revisions rather than solely relying on broker recommendations [4] - The Zacks Rank is timely and reflects the latest earnings estimates, unlike the ABR, which may not always be up-to-date [6] Investment Considerations for VRT - The Zacks Consensus Estimate for Vertiv has increased by 3.7% over the past month to $2.58, indicating growing optimism among analysts regarding the company's earnings prospects [7] - The increase in consensus estimates, along with other factors, has led to a Zacks Rank of 2 (Buy) for Vertiv, suggesting a positive outlook for the stock [7] - The Buy-equivalent ABR for Vertiv can serve as a useful guide for investors, complementing the insights provided by the Zacks Rank [7]

Financial Data and Key Metrics - Q3 organic sales increased by 19% YoY, with double-digit growth in all three regions [11] - Adjusted operating profit reached $417 million, beating guidance, with a 20.1% adjusted operating margin, expanding 310 basis points [12] - Adjusted free cash flow was $336 million in Q3, with $773 million generated year-to-date [12] - Leverage reduced to 1.4x by the end of Q3, strengthening the balance sheet [12] - Full-year guidance raised: organic growth expected at 14%, adjusted operating profit at $1.485 billion, and adjusted free cash flow at $1 billion, up $125 million from previous guidance [12][28][30] Business Line Performance - Power management represents 32% of the business, thermal management 30%, IT systems 10%, infrastructure solutions 5%, and services 23% [15] - Liquid cooling growth exceeds market growth, with the company rapidly gaining market share [17] - The company has a complete range of liquid and high-density solutions, including in-rack CDUs, manifolds, and immersion cooling [18] Market Performance - EMEA led with 25% organic sales growth, driven by strong demand from colocation and hyperscale customers [26] - Americas saw 21% organic sales growth, with broad strength across multiple market verticals and product lines [25] - APAC sales increased 10% organically, with China growing double-digits, though the company remains cautious about Q4 growth in China due to macroeconomic challenges [26] Strategic Direction and Industry Competition - The company is focused on AI and liquid cooling, with AI driving demand for data centers and liquid cooling becoming increasingly important [6][7] - Vertiv's portfolio is the broadest in the industry, covering thermal systems, power management, IT solutions, modular solutions, and services [8] - The company is working closely with key technology providers like NVIDIA to co-develop solutions for AI factories [9][20] Management Commentary on Operating Environment and Future Outlook - Management is optimistic about the long-term growth trajectory, driven by AI and data center demand [6][9] - The company expects growth in 2025 to accelerate relative to 2024, supported by strong orders and operational performance [10][12] - Inflation is expected to continue, and the company has incorporated this into its commercial excellence programs [14] Other Important Information - The company has expanded capacity, including a new modular solutions facility in the Americas, which started production and shipments in Q3 [14] - The Vertiv Operating System (VOS) continues to deliver incremental capacity, productivity gains, and reduced lead times [14] - The company plans to share revised long-term margin ambitions at the November 18th Investor Event [23] Q&A Session Summary Question: How does order timing work for hyperscalers building multi-location campuses? - Orders are typically placed for buildings currently being deployed, with good visibility on the entire program but exact PO timing varying by hyperscaler [34] Question: What drove the outperformance in Q3 orders? - The company exceeded Q3 order expectations, with strong trailing 12-month order growth indicating a healthy long-term trajectory [37] Question: How does Vertiv compete with ODMs in liquid cooling? - ODMs are seen as a go-to-market opportunity rather than competition, with Vertiv providing technology and service support to ODMs [38] Question: Will Vertiv continue to disclose trailing 12-month order numbers? - Yes, the company will continue to use trailing 12-month orders as the primary metric due to the lumpiness of orders [42] Question: How is the backlog expected to trend in 2025? - The company is optimistic about 2025 growth, supported by a strong backlog and pipeline, though specific details will be shared at the November Investor Event [42][43] Question: What is driving the confidence in incremental margins? - Confidence is driven by operational leverage, commercial execution, and a favorable price-cost environment [54] Question: How is the shift to liquid cooling affecting services revenue? - The services business is growing, with increasing demand for liquid cooling-related services, including installation, commissioning, and predictive maintenance [70] Question: Will thermal management growth outpace power management? - Liquid cooling is expected to grow rapidly, but power management will also benefit from data center densification, with the entire portfolio expected to see positive growth [72]