Vertiv Deep Dive: Bull Case - Upside to $150

Key Points

• Vertiv leading supplier of power and thermal management solutions (UPS, cooling, racks, services)
• Positioned to benefit from AI infrastructure explosion driving datacenter buildout
• Thermal management TAM of ~$13B by CY27 across all Vertiv solutions
• Upside scenario of $150 stock price based on 27x P/E and bull case CY26 EPS target
• High-teens to low-20s consistent sales growth expected with low-30s incremental margins

Bull Case Scenario

• Upside case assumes Vertiv outperforms on both hyperscale growth and margin expansion
• Revenue per megawatt opportunity of $2.5-3.5M for Vertiv (thermal + power + racks + services)
• Thermal management alone can drive 8-11% LT growth framework upside
• Bull case execution requires delivering on operational performance and net pricing

Investment Highlights

• AI datacenter buildout unlocking massive thermal management opportunity
• Market recognizing Vertiv's competitive positioning and technology differentiation
• Margin expansion potential through scale and system-level selling approach
• Strong backlog and pipeline supporting long-term growth visibility

Source

• File: Vertiv_Evercore_Deep Dive13_Mar_2024.pdf
• Location: Dropbox/2. Semi/Datacenter/Liquid cooling/Vertiv-initiation/
• Pages: 37
• Date: March 13, 2024
• Publisher: Evercore ISI

Related

• _MOC-datacenter
• vertiv-q4-2024-earnings
• liquid-cooling-opportunity-deepdive-isi