Core Insights - Ansys technology is enabling Vertiv to enhance the design and delivery of customized data center cooling systems, improving agility and reducing go-to-market time [1][4] - The collaboration focuses on optimizing the design of heat exchanger coils, which are crucial for data center thermal management, allowing for faster and more reliable designs [2][3] - Ansys Minerva™ and optiSLang™ frameworks facilitate automated simulations and design optimizations, leading to reduced material usage and cost savings for Vertiv [3][5] Group 1: Collaboration and Technology - Vertiv is partnering with Ansys to digitally transform its data center cooling systems, leveraging Ansys' digital engineering technology for improved scalability and early decision-making [1][4] - The use of Ansys' optiSLang™ framework allows Vertiv to rapidly simulate ideal design configurations, minimizing the need for physical prototypes [3] Group 2: Product Development and Efficiency - The integration of Ansys technology enables Vertiv's engineering team to significantly reduce development time for heat exchanger coils, which are complex to design [2] - Ansys Minerva™ allows both experts and non-experts to access automated simulations, streamlining the design process and eliminating delays caused by designer-to-engineer handoffs [3] Group 3: Market Position and Future Outlook - Vertiv aims to revolutionize data center design by incorporating AI into their cooling and power technologies, enhancing infrastructure for AI-based projects [4] - The collaboration with Ansys is expected to improve productivity and reduce costs, positioning Vertiv as a leader in providing customized solutions for AI-enabled infrastructure [5]

Vertiv TodayVRTVertiv$123.81 -2.99 (-2.36%) 52-Week Range$41.01▼$130.30Dividend Yield0.08%P/E Ratio82.54Price Target$122.11Add to WatchlistVertiv Holdings Co. NYSE: VRT has become a standout player in the industrial sector this year, with its stock up over 160% year-to-date and more than 200% over the past year. This under-the-radar industrial company recently surpassed Q3 expectations and raised its Q4 guidance, bolstering momentum in a market increasingly focused on AI-driven infrastructure. Given its re ...

Core Viewpoint - Vertiv Holdings has demonstrated strong performance in Q3 2024, exceeding expectations and raising guidance, driven by robust demand for data center infrastructure, particularly due to the growth of artificial intelligence [2][3][4]. Financial Performance - Q3 2024 revenue reached $2.07 billion, surpassing the consensus estimate of $1.98 billion by 0.16% [2]. - Adjusted earnings per share for Q3 2024 were $0.76, exceeding the consensus of $0.69 by seven cents [2]. - The adjusted operating margin for Q3 2024 was 20.1%, which is 0.2 percentage points above the company's forecast [2]. - Q4 2024 revenue forecast is between $2.115 billion and $2.165 billion, with the midpoint $10 million below market estimates [2]. - Full year 2024 revenue forecast ranges from $7.78 billion to $7.83 billion, with the midpoint $70 million above analysts' estimates of $7.73 billion [2]. Market Demand and Growth Drivers - The demand for Vertiv's products is significantly driven by the growth of artificial intelligence, which is accelerating the need for data center infrastructure [4][5]. - In 2023, capital expenditures on data centers totaled $215 billion, with approximately $161 billion allocated to IT equipment and data center infrastructure, areas where Vertiv competes [6]. - Gartner projects a 34% increase in data center systems spending in 2024, reaching $318 billion, outpacing overall IT spending growth [7]. Competitive Position - Vertiv is recognized as a leader in the data center infrastructure market, being the largest provider of thermal equipment and the second-largest vendor of electrical equipment globally [8]. - The company offers advanced cooling solutions, including liquid cooling systems, which are more efficient than traditional air cooling methods [10][14]. Analyst Sentiment - Analysts are optimistic about Vertiv's growth potential, with 16 analysts rating the stock a buy, indicating strong confidence in the company's future performance [13]. - Analysts highlight the shift from air to liquid cooling as a significant opportunity for Vertiv, positioning the company favorably in the market [14][15]. - Continued strength in data center demand and rising rack heat densities are seen as key factors for Vertiv's growth, with analysts raising price targets for the stock [15].

Core Viewpoint - Vertiv (VRT) has experienced significant stock performance, with a 12.5% increase over the past month, outperforming the broader Zacks Computer & Technology sector and the Zacks IT Services industry [1][3]. Group 1: Company Performance - Vertiv serves data center providers and is benefiting from strong AI-driven order growth, with a backlog of $7.4 billion, reflecting a 47% year-over-year increase and a 5% sequential increase [2][5]. - The company expects fourth-quarter revenues between $2.12 billion and $2.17 billion, indicating an organic growth rate of 11-15% year-over-year, with non-GAAP earnings projected between 80 cents and 84 cents per share [6]. - For the full year 2024, Vertiv anticipates revenues between $7.78 billion and $7.83 billion, indicating an organic growth rate of 13-15% year-over-year, with non-GAAP earnings expected between $2.66 and $2.70 per share [7]. Group 2: Product and Capacity Expansion - Vertiv is expanding its manufacturing capacity globally, currently operating 23 plants, to meet the increasing demand driven by AI [8]. - The company has opened a new 215,000 square feet facility in Pelzer, SC, to support the production of integrated modular solutions and other systems for data centers [9]. - Vertiv has enhanced its liquid cooling portfolio with new products designed to support high-density computing for AI applications [10]. Group 3: Strategic Partnerships - Vertiv has collaborated with NVIDIA to launch a 7MW reference architecture for AI infrastructure, optimizing power and cooling for AI-driven data centers [11]. - The company is working with Ballard Power Systems to develop scalable backup power applications for data centers, integrating fuel cell power modules with its UPS systems [12]. - Vertiv has added ZincFive's UPS battery cabinets to its backup power systems portfolio, further enhancing its offerings for data center resilience [13]. Group 4: Valuation and Investment Outlook - Despite strong growth prospects, VRT shares are considered to have a stretched valuation, with a trailing Price/Book ratio of 26.02, significantly higher than the sector median [14]. - Vertiv's dominance in thermal management for data centers is viewed as a key growth driver, supported by an improving liquidity position [17].

Core Viewpoint - Wall Street analysts' recommendations significantly influence investor decisions, but their reliability is questionable, particularly for Vertiv Holdings Co. (VRT) [1][3]. Group 1: Brokerage Recommendations - Vertiv has an average brokerage recommendation (ABR) of 1.00, indicating a Strong Buy, based on 12 recommendations, all of which are Strong Buy [2]. - Despite the positive ABR, relying solely on this information for investment decisions may not be advisable, as studies show brokerage recommendations often fail to guide investors effectively [3][4]. - Analysts from brokerage firms tend to exhibit a strong positive bias in their ratings, issuing five "Strong Buy" recommendations for every "Strong Sell" [4][8]. Group 2: Zacks Rank vs. ABR - The Zacks Rank, a proprietary stock rating tool, is a more reliable indicator of near-term price performance, classifying stocks from Zacks Rank 1 (Strong Buy) to Zacks Rank 5 (Strong Sell) [6][9]. - Unlike ABR, which is based solely on brokerage recommendations, Zacks Rank incorporates earnings estimate revisions, which are strongly correlated with stock price movements [9][10]. - The Zacks Rank is updated more frequently than ABR, making it a timely predictor of future stock prices [10]. Group 3: Earnings Estimates for Vertiv - The Zacks Consensus Estimate for Vertiv's earnings has increased by 4.2% over the past month to $2.69, reflecting analysts' growing optimism about the company's earnings prospects [11]. - This increase in consensus estimates, along with other factors, has resulted in a Zacks Rank 1 (Strong Buy) for Vertiv, suggesting a potential for stock price appreciation [12].

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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].