Core Viewpoint - Nvidia CEO Jensen Huang's remarks at CES 2026 have significantly impacted the stock market, leading to a surge in storage-related stocks while causing declines in data center cooling stocks [1][2]. Group 1: Storage Stocks Surge - SanDisk's stock price soared nearly 28% to $349.63 per share, reaching a market cap of $51.24 billion, marking a tenfold increase since February of the previous year [2][4]. - Huang emphasized the untapped potential of the storage market, predicting it could become the largest global storage market to support AI workloads, with current demand exceeding existing infrastructure capabilities [4]. - Other storage companies like Western Digital, Seagate, and Micron also saw significant stock price increases, with Western Digital up 16.77% to $219.38, Seagate up 14% to $330.42, and Micron up 10% to $343.43, all achieving double-digit percentage gains [6][7]. Group 2: AI-Driven Hardware Spending - The growth in AI training and inference demand is leading to tight memory supply and rising prices, boosting digital storage stocks [12]. - Analysts predict that companies will retain more data for training, analysis, and compliance, driving a surge in storage demand, particularly in sectors like drones, surveillance, and automotive technology [14]. - The focus on AI investment has shifted towards hardware spending, with expectations that AI inference will dominate beyond 2026 [14]. Group 3: Cooling Stocks Decline - Huang's comments raised concerns about the demand for data center cooling products, leading to declines in cooling-related stocks [15]. - Johnson Controls' stock fell 6.24%, Modine Manufacturing dropped 7.46%, and Trane Technologies decreased by 2.52%, with significant intraday losses [15][19]. - Analysts noted that the shift towards liquid cooling technology could impact traditional cooling systems, although some believe the recent sell-off may be excessive [21].

Core Viewpoint - Vertiv Holdings Co (NYSE:VRT) is gaining attention as a significant player in the AI sector, with Barclays upgrading its stock rating to "Overweight" and increasing the price target to $200, driven by improved earnings outlook and alignment with AI trends [1][4]. Earnings Expectations - The rating change reflects revised earnings expectations for 2026 and 2027, with earnings per share estimates 8% above consensus for 2026 and 12% above for 2027, primarily influenced by revenue assumptions [2]. Revenue Exposure - VRT's revenue is heavily tied to data centers, with 80% of sales coming from this end market. The company's organic sales growth has closely followed U.S. data center physical infrastructure trends, surpassing the multi-industry average in recent years [3]. Analyst Insights - Analysts believe that VRT is positioned for significant gains in 2026, potentially catching up with other Overweight-rated AI companies despite previous underperformance. The stock's recent volatility has created an attractive entry point [4][5]. Competitive Positioning - VRT has underperformed compared to other Overweight-rated AI stocks year-to-date, but its PEG ratio is now at parity with peers, suggesting a potential for performance catch-up in 2026 [5].

Core Viewpoint - Vertiv has significantly outperformed the S&P 500 over the past five years, but smaller AI stocks like Iren may present better investment opportunities due to their higher growth potential [1][2]. Company Performance - Vertiv's stock has increased by 39% over the past year and over 550% in the last five years, driven by investor interest in its liquid cooling solutions for data centers [1]. - In Q3, Vertiv reported a year-over-year revenue growth of 29%, but guidance for Q4 suggests a slowdown with expected growth of 18% to 22% [6]. Comparison with Iren - Iren's stock price has more than quadrupled in the past year, indicating a strong growth trajectory, and it has a market cap of $12 billion compared to Vertiv's $67 billion [2][7]. - Iren is projected to generate $20 billion in annual recurring revenue within five to ten years, supported by a significant deal with Microsoft worth $9.7 billion [3][4]. Revenue Projections - Iren aims for $3.4 billion in annual recurring revenue by the end of 2026, up from $3.1 million in fiscal 2024 and $16.4 million in fiscal 2025 [4]. - Management has indicated expectations of reaching $200 million to $250 million in annual recurring revenue by December 2025, suggesting potential to exceed the $3.4 billion target [5]. Market Dynamics - The smaller market cap of Iren allows for potentially greater stock price movements, which could benefit investors seeking faster growth compared to Vertiv [7].

Group 1: Market Overview - Global markets are buoyed by enthusiasm for artificial intelligence (AI) and the expansion of data center infrastructure, with data center M&A projected to reach approximately $61 billion through 2025, surpassing the previous year's record [1] - Demand for physical infrastructure continues to drive investment themes, despite some concerns about potential overvaluation in parts of the AI sector [1] Group 2: Company Positioning - Vertiv (VRT) is well-positioned to benefit from the ongoing data center investment trend, with Barclays upgrading the stock to "Overweight" due to recent price weakness presenting an attractive entry point [2] - Approximately 80% of Vertiv's sales are derived from data centers, and the company is expected to exceed Street earnings estimates for 2026 [2][3] Group 3: Financial Performance - Vertiv's stock experienced significant growth in 2025, more than doubling early in the year due to increased data center demand and expanded business with hyperscale AI customers, reaching a record price above $202 before a year-end pullback to around $165 to $170, approximately 15% off its peak [5] - The stock trades at a premium, with a forward price/book ratio of 17.19 compared to the sector median of 3.34, indicating a higher valuation, but analysts suggest this reflects anticipated revenue and earnings growth of about 25% to 30% [6]

Core Viewpoint - The cooling stocks for data centers experienced a significant decline following Jensen Huang's comments regarding data center cooling solutions at the CES event, indicating a potential shift in technology that could impact the market dynamics for these companies [1] Group 1: Market Reaction - Data center cooling stocks collectively dropped, with Johnson Controls and Trane Technologies falling by 10% at one point [1] - Modine experienced a decline of up to 20% [1] - Carrier and Vertiv Technologies saw declines exceeding 5% [1] Group 2: Technological Implications - Jensen Huang stated that servers equipped with the new Rubin chip could utilize cooling methods that do not require water, suggesting a significant change in cooling technology [1] - The airflow requirements for the new Rubin chip servers are comparable to those of the existing Blackwell chip servers, indicating a potential for reduced cooling costs and infrastructure changes [1]

Core Viewpoint - Data center cooling stocks experienced a significant decline, with major companies like Modin Manufacturing, Johnson Controls, Trane Technologies, and Vertiv Technologies facing substantial drops in their stock prices following comments made by Jensen Huang at the CES event regarding new cooling technologies [1] Group 1: Stock Performance - Modin Manufacturing (MOD.US) saw a drop of over 13% [1] - Johnson Controls (JCI.US) and Trane Technologies (TT.US) both fell by more than 7% [1] - Vertiv Technologies (VRT.US) experienced a decline of over 3% [1] Group 2: Technological Developments - Jensen Huang announced that servers equipped with the new Rubin chip will be able to operate without water cooling, requiring airflow comparable to that of racks using the Blackwell chip [1]

Group 1 - The core viewpoint of the article highlights a significant decline in the stock prices of data center cooling concept stocks, with notable drops in companies such as Trane Technologies (TT), Carrier Global (CARR), Johnson Controls (JCI), Modine Manufacturing (MOD), and Vertiv Holdings (VRT) [1] Group 2 - Trane Technologies (TT) experienced a drop of over 10% in early trading [1] - Carrier Global (CARR) saw a decline of approximately 6.6% [1] - Johnson Controls (JCI) fell by 10.8% [1] - Modine Manufacturing (MOD) reported a decrease of 13.5% [1] - Vertiv Holdings (VRT) declined by 6% [1] - Investors are paying close attention to the latest remarks from NVIDIA CEO Jensen Huang [1]

Group 1 - Data center cooling stocks experienced a significant decline on January 6, with major companies like Johnson Controls and Trane Technologies dropping by 10% at one point [1] - Modine Industries saw a more severe decline, with its stock falling by 20% during the trading session [1] - Carrier and Vertiv Technologies also faced losses, with both companies' stocks decreasing by over 5% [1]

Core Insights - Vertiv (VRT) shares have increased by 31% over the past 12 months, outperforming the Zacks Computer and Technology sector's growth of 22.6% and the Zacks Computers - IT Services industry's decline of 19.4% [1][2] Company Performance - Vertiv has outperformed its closest competitors, Super Micro Computer (SMCI) and Hewlett-Packard Enterprise (HPE), with HPE shares rising by 5.8% and SMCI shares falling by 15.1% in the same period [2] - The stock's outperformance is attributed to a diverse product portfolio, including thermal systems, liquid cooling, UPS, switchgear, busbars, and modular solutions, with organic orders growing approximately 21% and a book-to-bill ratio of 1.4 for Q3 2025 [3] - The backlog increased by 12% sequentially and 30% year-over-year to $9.5 billion, driven by the rapid adoption of AI and the growing need for data centers [4] Strategic Acquisitions - Vertiv's acquisitions have significantly expanded its portfolio, including the $1.0 billion purchase of PurgeRite, enhancing its capabilities in liquid cooling and thermal management [7][8] - The acquisition of Great Lakes improved Vertiv's IT systems offerings, while the acquisition of Weeleay enhanced service capabilities through real-time machine data analysis [9] Market Demand and Growth - The demand for data center infrastructure is being driven by the global acceleration of AI adoption, with Vertiv experiencing a 43% organic sales growth in the Americas and 21% growth in APAC in Q3 2025 [10][11] - Vertiv's partnerships with major companies like NVIDIA and Intel are supporting its growth in global data center markets [12][13] Financial Guidance - For Q4 2025, Vertiv expects revenues between $2.81 billion and $2.89 billion, with organic net sales growth projected at 18% to 22% [14] - For the full year 2025, revenues are anticipated to be between $10.16 billion and $10.24 billion, with organic net sales growth expected at 26% to 28% [15] Earnings Estimates - The Zacks Consensus Estimate for Q4 2025 earnings is $1.28 per share, indicating a year-over-year increase of 29.29%, with revenues expected to grow by 22.09% [16] - The 2025 earnings estimate is pegged at $4.11 per share, reflecting a 44.21% increase from 2024 [17] Valuation - Vertiv is currently trading at a premium, with a trailing 12-month Price/Book ratio of 19.14X compared to the sector's 10.74X, indicating a potential overvaluation [18] Conclusion - Vertiv's strong portfolio and extensive partner base are driving order growth, justifying its premium valuation, and the company holds a Zacks Rank 2 (Buy) with a Growth Score of A, indicating a strong investment opportunity [21]

Market Overview - U.S. stock futures rose in the first full trading week of the year, with major benchmark indices showing positive movement [1] - Crude oil prices fluctuated, with WTI's February Futures trading 0.05% lower at $57.29 per barrel following geopolitical developments in Venezuela [2] - The 10-year Treasury bond yielded 4.17%, while the two-year bond was at 3.46%, with an 82.3% likelihood of the Federal Reserve maintaining current interest rates in January [3] Company Highlights - Ironwood Pharmaceuticals Inc. (NASDAQ:IRWD) advanced 2.81% after issuing FY26 guidance, expecting U.S. net sales of Linzess to be between $1.125 billion and $1.175 billion, with total revenue expectations of $450 million to $475 million and adjusted EBITDA over $300 million [6] - Vertiv Holdings Co. (NYSE:VRT) shares increased by 1.62% after being upgraded to "overweight" by Barclays, with a 75% chance of joining the S&P 500 index [7] - Nukkleus Inc. (NASDAQ:NUKK) rose 3.79% following the completion of a $14 million acquisition of Tiltan Software Engineering, an Israeli defense software company [7] - Brand Engagement Network Inc. (NASDAQ:BNAI) shares climbed 8.22% after announcing a Vendor Services Project Agreement with a global advertising agency [16] - GH Research PLC (NASDAQ:GHRS) soared 19.05% after announcing an update on its FDA IND status and Phase 3 program for GH001 in treatment-resistant depression [16] Sector Performance - The U.S. market saw broad gains across various sectors, including Energy, Industrials, Materials, Utilities, Health Care, Financials, Real Estate, and Information Technology, while Consumer Staples, Communication Services, and Consumer Discretionary were the only sectors to decline [10] - The performance of major indices included a 0.66% increase in the Dow Jones, a 0.19% increase in the S&P 500, and a 1.06% increase in the Russell 2000 [11] Economic Outlook - JPMorgan's "Eye on the Market 2026 Outlook" anticipates continued strength in U.S. equity markets, driven by the technology sector and AI-related spending, despite potential corrections of 10%-15% due to profit-taking [12][13] - The report highlights that tech sector capital spending contributed 40%-45% of U.S. GDP growth over the last three quarters of 2025, with consumer spending expected to remain stable in 2026 [14]