Company Overview - Vertiv Holdings Co (NYSE:VRT) specializes in providing digital infrastructure technologies and lifecycle services for data centers, networks, and industrial environments, including power management, thermal systems, modular solutions, and monitoring software [2]. Investment Insights - Jim Cramer highlighted Vertiv as a stock to consider for investment, particularly in light of positive data center performance indicators from Oracle, which he views as a validation for Vertiv's business [1]. - Cramer expressed confidence in Vertiv's potential, suggesting that it is an opportune time to invest in the company, especially given its strong product offerings and market position [2]. Market Context - The discussion around Vertiv is set against a backdrop of significant developments in the tech industry, including Amazon's product capabilities and the broader implications of AI advancements, which may influence investment strategies [2].

Group 1 - Shares in Vertiv rose by 9.4% in the week through Friday morning, reflecting a positive sentiment in the AI and data center market [1] - The sector experienced a boost from a significant deal between OpenAI and Oracle, where OpenAI will purchase $300 billion worth of computing power from Oracle over five years, indicating strong investment trends in data centers [2] - Vertiv has raised its full-year sales, earnings, and cash flow guidance due to a strengthening environment, with organic orders increasing by 15% year over year in the second quarter, suggesting continued growth [3] Group 2 - Vertiv is developing power infrastructure solutions for next-generation data center technology, specifically the new 800V high voltage direct current (HVDC) data centers, which are expected to launch in 2027 [5] - The ramp-up in AI and data center spending, as indicated by Oracle's deal, suggests that the technology Vertiv is currently developing will see strong demand in the coming years [6]

Core Insights - Oracle's quarterly results highlighted a significant increase in AI-related spending, with its backlog rising 359% to $455 billion, driven by investments from AI hyperscalers and a major deal with OpenAI [1] Company Overview: Vertiv - Vertiv, a company collaborating with Nvidia, is positioned to benefit from the AI data center boom, ensuring high-density computing operates efficiently around the clock [2][6] - The company has a diverse portfolio that includes critical power, thermal management, and IT infrastructure, supporting the operations of AI data centers and the technology-driven economy [4] Financial Performance - Vertiv has received a Zacks Rank 1 (Strong Buy) due to an improving earnings outlook, with a projected revenue growth of 25% in 2025 and 16% in 2026, reaching $11.55 billion, which is double its 2021 total [3][8] - The company is expected to expand its adjusted earnings per share (EPS) by 34% this year and 27% next year, following a 60% EPS growth last year and a remarkable 236% in 2023 [10][8] Market Attention and Analyst Recommendations - Wall Street's interest in Vertiv has increased, with 23 brokerage recommendations, 18 of which are "Strong Buys," reflecting confidence in its AI-driven growth potential [11] - The stock has outperformed AI hyperscalers, climbing 900% over the past three years, compared to Meta's 345% increase in the same period [12] Valuation and Trading Dynamics - Vertiv's stock trades approximately 12% below its average price target and is at a 30% discount to its highs, with a forward P/E ratio of 30.1X, compared to the tech sector's 28.6X [15] - The stock recently surged above its 50-day moving average, indicating potential for further upward momentum and new all-time highs [16]

Vertiv (NYSE:VRT) FY Conference Summary Company Overview - **Company**: Vertiv - **Date**: September 10, 2025 - **Key Speakers**: CEO Giordano Albertazzi, CFO David Fallon Industry Insights - **Market Demand**: Strong demand in the data center market with a reported **35% organic growth** last quarter and a **$1.2 book-to-bill ratio** [3][25] - **Pipeline Strength**: The strength of the pipeline is a critical indicator of future performance, defined as active commercial opportunities with quotes [5][6] - **Liquid Cooling**: The industry is shifting towards liquid cooling, which is expected to represent about **one-third of the total Total Addressable Market (TAM)** for data center cooling [9][10] - **CapEx Structure**: The growth in IT spending is increasing, but the physical infrastructure segment remains strong, indicating a healthy TAM for Vertiv [11][12] Key Company Strategies - **Focus on White Space**: Vertiv is increasing its presence in the white space of data centers, which is becoming a fertile ground for growth due to rising complexity in power and cooling distribution [12][14] - **Future-Proofing Infrastructure**: The company is collaborating with key players like NVIDIA to design future-proof data center infrastructures [16][19] - **Prefabrication Solutions**: Introduction of prefabricated solutions to significantly reduce fit-out time in data centers, enhancing time to revenue for customers [13][14] Growth Constraints and Capacity - **Growth Moderating Factors**: Power availability is a limiting factor in some regions, but there is no expectation of a cliff in demand. The construction nature of the data center industry also limits speed [25][26] - **Capacity Management**: Vertiv is expanding manufacturing capacity and ensuring service capacity grows in line with manufacturing to maintain operational leverage [27][29] Financial Performance - **Margins**: Gross margins faced pressure due to tariffs and operational challenges, but a recovery is projected with operating margins expected to reach **20% in Q3** and **over 23% in Q4** [33][34] - **Pricing Strategy**: The company is actively managing pricing to offset tariff impacts and is confident in maintaining a price-cost positive position moving forward [35][36] Regional Market Insights - **North America**: Strong growth with a **40% increase** in physical shipments [40] - **Europe**: Slow growth attributed to regulatory challenges, but strong pipelines and low vacancy rates in data centers suggest potential for future growth [42][43] - **Asia-Pacific**: Generally positive outlook, with specific mentions of growth opportunities in India and China [43] Conclusion - Vertiv is well-positioned in the data center market with strong growth indicators, a focus on innovative solutions, and strategic partnerships. The company is navigating challenges related to tariffs and capacity while maintaining a positive outlook for future performance.

Market Overview - The U.S. equity markets have experienced significant volatility, reaching record highs due to Federal Reserve Chair Jerome Powell's hints at rate cuts, but also declining sharply due to concerns over NVIDIA's upcoming earnings release [1] - President Trump's actions, including threats to remove Federal Reserve Governor Lisa Cook, have contributed to market uncertainty, potentially leading to a legal battle that could escalate to the Supreme Court [1] Momentum Investing Strategy - Investors are increasingly turning to momentum stocks, such as Vertiv Holdings Co (VRT), MasTec, Inc. (MTZ), and Robinhood Markets, Inc. (HOOD), as a strategy to achieve sustained profits when traditional value or growth investing does not yield desired results [2] - Momentum investing is based on the principle of "buying high and selling higher," capitalizing on established trends that are likely to continue due to existing momentum [3] Screening Parameters for Momentum Stocks - The strategy involves selecting the top 50 stocks with the best percentage price change over the last 52 weeks to identify those that have appreciated steadily [5] - From these, the 10 worst performers over the past week are chosen to identify stocks that have experienced a short-term pullback [6] - Stocks with a Zacks Rank 1 (Strong Buy) are included, as they have a proven history of outperformance [6] - A Momentum Style Score of B or better is required, indicating favorable timing for investment [7] - Stocks must have a current price greater than $5 and be among the top 3000 by market capitalization to ensure stability [8] Selected Stocks - Vertiv has seen a price increase of 60.2% over the past year but has declined by 7.9% in the last week, with a Momentum Score of B [9] - MasTec's stock has risen by 59.7% in the past year, with a slight decrease of 0.7% in the last week, also holding a Momentum Score of B [10] - Robinhood Markets has surged by 415% over the past year but has fallen by 6.2% in the last week, boasting a Momentum Score of A [11]

Core Insights - Vertiv Holdings Co, a leader in critical digital infrastructure, is participating in two investor conferences in September 2025 [1][2] - The CEO Giordano Albertazzi and CFO David Fallon will engage in fireside chats at both conferences [1][2] Group 1: Upcoming Events - The first event is the Goldman Sachs Communacopia + Technology Conference on September 9, 2025, at 8:10 a.m. Pacific time [1] - The second event is Morgan Stanley's 13th Annual Laguna Conference on September 10, 2025, at 9:15 a.m. Pacific time [2] - Live webcasts and related presentation materials will be available on Vertiv's Investor Relations website [2] Group 2: Company Overview - Vertiv integrates hardware, software, analytics, and services to support critical applications for data centers and communication networks [3] - The company operates in over 130 countries, providing solutions for power, cooling, and IT infrastructure [3] - Vertiv's offerings are designed to address challenges in data centers and commercial facilities, enhancing operational performance [3]

Core Insights - Vertiv Holdings Co has successfully completed the acquisition of Great Lakes Data Racks & Cabinets for approximately $200 million, enhancing its leadership in high-density integrated infrastructure solutions for data centers and critical digital environments [1][2]. Group 1: Acquisition Details - The acquisition expands Vertiv's portfolio in rack, cabinet, and integration solutions specifically for white space applications [1][2]. - Great Lakes, established in 1985 and headquartered in Edinboro, PA, operates manufacturing and assembly facilities in the U.S. and Europe, offering a range of products including standard and custom racks, integrated cabinets, and enhanced cable management options [3]. Group 2: Strategic Benefits - The integration of Great Lakes' expertise is expected to streamline infrastructure sourcing, enable faster deployment through pre-engineered solutions, and enhance operational efficiency with factory integration of Vertiv's power and cooling solutions [2]. - The acquisition will improve scalability for AI and edge computing applications and provide comprehensive support through Vertiv's global service network [2]. Group 3: Company Overview - Vertiv provides critical digital infrastructure solutions, combining hardware, software, analytics, and ongoing services to support vital applications across data centers, communication networks, and commercial facilities [5]. - The company operates in over 130 countries, addressing challenges in power, cooling, and IT infrastructure from the cloud to the edge of the network [5].

Core Viewpoint - The increasing demand for artificial intelligence is driving significant investment in data centers, benefiting companies like Vertiv, which has seen its stock rise by 84% since March [1]. Group 1: Company Performance - Vertiv's sales guidance for 2025 has shown a consistent upward trend, with an increase from $9.125 million in February to $9.925 million in July, representing an 8.7% increase [4]. - The adjusted operating profit guidance has also increased, but at a slower rate, from $1.910 million in February to $2.030 million in July, reflecting a 2.8% increase [4]. - Free cash flow guidance has improved from $1.275 million in February to $1.375 million in July, marking a 7.7% increase [4]. Group 2: Market Dynamics - The growth in the data center market is primarily driven by the rising demand for artificial intelligence applications, indicating a multi-year expansion in data center spending [6]. - Vertiv is positioned to benefit from this trend, particularly through its collaboration with Nvidia in developing power systems for next-generation data centers [6]. Group 3: Future Outlook - Provided that the tariff environment remains stable, future orders and revenue increases for Vertiv are expected to lead to significant profit and cash flow growth [5]. - The company is in the early stages of capitalizing on the expanding data center market, suggesting that it is not too late for investment opportunities [7].

Core Insights - Investors are encouraged to focus on companies that generate strong returns after covering all expenses, emphasizing the importance of profitability over loss-making firms [1] - NVIDIA, Vertiv, and Mastercard are highlighted as top investment picks for the year due to their high net income ratios [2] Profitability Metrics - The net income ratio is a key indicator of a company's profitability, representing the percentage of net income relative to total sales revenues, with a higher ratio indicating better revenue generation and expense management [3] - Additional screening parameters include Zacks Rank, trailing 12-month sales and net income growth, and a strong buy percentage rating, which help identify potential winning stocks [4][5] Company Profiles - **NVIDIA**: Engages in graphics, computing, and networking solutions globally, with a 12-month net profit margin of 51.7% and a Zacks Rank of 3 (Hold) [5] - **Vertiv**: Provides infrastructure technologies for data centers, achieving a 12-month net profit margin of 8.9% and a Zacks Rank of 2 (Buy) [6] - **Mastercard**: Offers global payment processing services, with a 12-month net profit margin of 44.9% and a Zacks Rank of 2 [7]

Core Industry Insights - Applied Digital (APLD) and Vertiv Holdings (VRT) are central to the digital infrastructure expansion, driven by increasing demand for data center capacity due to AI, cloud computing, and high-performance computing workloads [2][3] - Global data center capital expenditures are projected to grow at a 21% CAGR through 2029, reaching approximately $1.2 trillion, benefiting both APLD and VRT [3] Company Performance: Applied Digital (APLD) - APLD has shifted from cryptocurrency mining to becoming a dedicated AI infrastructure provider, capitalizing on the growth of AI and machine learning workloads [5] - In Q4 fiscal 2025, APLD reported revenues of $38 million, a 41% increase year over year, and achieved positive adjusted EBITDA of $1 million [6] - APLD's partnership with CoreWeave is expected to generate around $7 billion in contracted revenue over 15 years for 250 megawatts of critical IT load [7] - The company has improved construction efficiency, reducing deployment timelines from 24 months to 12-14 months [7] - APLD's North Dakota locations provide low-cost energy and innovative cooling systems, enhancing its competitive position in the market [8] Company Performance: Vertiv Holdings (VRT) - VRT is a leading provider of thermal and power management solutions for high-density data centers, with a broad product portfolio addressing critical infrastructure needs [9] - In Q2 2025, VRT's net sales rose 35% year over year to $2.64 billion, with quarterly orders surpassing $3 billion for the first time [10][11] - VRT's strategic partnerships and acquisitions, including the $200 million acquisition of Great Lakes, enhance its capabilities in AI data center offerings [12] Stock Performance and Valuation - Year-to-date, APLD shares have increased by 95.9%, while VRT shares have appreciated by 26.5% [13] - Both companies are currently considered overvalued, with APLD trading at a forward Price/Sales ratio of 12.98X compared to VRT's 5.07X [16] - Earnings estimates show APLD's first quarter fiscal 2026 loss is expected to be 6 cents per share, improving by 33.33% over the past 30 days [19] - VRT's third-quarter 2025 earnings estimate is pegged at 98 cents per share, reflecting a 28.95% year-over-year increase [20] Conclusion - Both APLD and VRT are well-positioned to benefit from the AI-driven expansion in data center infrastructure, with APLD showing a more accelerated growth path [21][22] - VRT maintains strong growth visibility through its product portfolio and industry partnerships, but its expansion is less aggressive compared to APLD [22]