Group 1 - Vertiv's third-quarter orders increased by approximately 60% year-on-year, leading to a record backlog of $9.5 billion [2][4] - Morgan Stanley raised Vertiv's target price to $230, citing AI-driven data center demand accelerating from "light speed" to "ludicrous speed" [2][4] - The company's sales reached $2.676 billion, a year-on-year increase of about 28%, exceeding the upper limit of company guidance [4][6] Group 2 - Analysts believe that despite a significant rise in Vertiv's stock price this year, the risk-reward profile remains attractive [6][8] - The substantial backlog provides a solid foundation for future performance, with Morgan Stanley's model showing earnings per share (EPS) forecasts for 2026 and 2027 being 15-20% higher than market consensus [6][7] - In a favorable scenario, the EPS for 2027 could reach $9, which is 30-50% higher than current market consensus [7] Group 3 - Vertiv's stock has performed well over the past year, with its valuation at a relatively high level within the industry [8] - Morgan Stanley argues that this premium is justified, as the company's growth prospects remain strong [8][9] - The report indicates that the market consensus may still underestimate Vertiv's growth potential, with projected P/E ratios for 2026/2027 being 31x/25x, lower than the market consensus of 36x/31x [9]

Core Insights - Vertiv's third-quarter orders increased by approximately 60% year-over-year, leading to a record backlog of $9.5 billion [1][2] - Morgan Stanley raised Vertiv's target price to $230, citing AI-driven data center demand accelerating from "light speed" to "ludicrous speed" [1][2] - The strong order and project pipeline may support Vertiv's performance in 2027, potentially exceeding current market consensus by 50% [3] Financial Performance - Vertiv reported third-quarter sales of $2.676 billion, a year-over-year increase of about 28%, surpassing the company's guidance [2] - Adjusted earnings per share were $1.24, significantly above the market expectation range of $0.94 to $1.00 [2] - The order-to-shipment ratio rose to 1.4, contributing to the record backlog [2] Market Outlook - Analysts believe that despite a significant rise in Vertiv's stock price this year, the risk-reward profile remains attractive [3] - The substantial backlog provides a solid foundation for future performance, with projections for 2026 and 2027 earnings per share being 15-20% higher than market consensus [3] - In a favorable scenario, 2027 earnings per share could reach $9, representing a 30-50% increase over current market consensus [3] Valuation and Growth Potential - Although Vertiv's valuation is currently high, it is considered reasonable due to strong growth prospects [4][6] - From a price-to-earnings growth ratio perspective, Vertiv's valuation remains one of the "cheapest" in the industry, given its leading growth outlook [7] - Morgan Stanley noted that market consensus may still underestimate Vertiv's growth potential, with projected P/E ratios for 2026/2027 at 31x/25x, lower than the market consensus of 36x/31x [7]