The market demand for datacenters is crucial for Vertiv. Vertiv expects to add 100GW of datacenters from 2023 to 2029, while currently, the global datacenter capacity is only 40GW.
Investor Day had a positive response, focusing on datacenter equipment and service providers.$Vertiv Holdings (VRT.US)$The stock price soared.
On Investor Day, November 18th, Vertiv showcased its latest technology, reaffirmed its 2024 targets, and provided a sales outlook for 2025 that exceeded market expectations.
Vertiv has raised its long-term sales growth and profitability targets for this year through 2029, expecting a long-term revenue CAGR of 12% to 14%, and an operating margin of 25%. Previously, Vertiv anticipated a long-term revenue CAGR of 8% to 11%, with an operating margin of over 20%.
Additionally, Vertiv raised its regular annual cash dividend by 50%, from 10 cents to 15 cents per share, paid quarterly.
Vertiv's impressive outlook on Investor Day left a strong impression on Wall Street, and after the event, Vertiv's stock price skyrocketed, receiving bullish reports from several Wall Street institutions.
On Tuesday, vertiv holdings rose over 14%, closing at $140.94 per share.
vertiv holdings: By 2029, datacenters will triple.
As a company focused on datacenter infrastructure, vertiv holdings provides critical technologies such as power management and temperature control systems, which are widely used in datacenters, communication networks, and other locations requiring stable electrical utilities support.
Therefore, the market demand for datacenters is crucial for vertiv holdings.
During the investor day, vertiv holdings stated that they expect to add 100GW of datacenters from 2023 to 2029, while currently, the global datacenters only amount to 40GW.
vertiv holdings also expects that the value of traditional datacenters is $2.5-3 million per MW (1GW=1000MW), while the value of high-density datacenters is $3-3.5 million per MW, indicating existing market space between them.
Currently, evercore analysts Amit Daryanani and Oppenheimer analyst Noah Kaye reaffirmed their "outperform large cap" rating on vertiv holdings stocks, with Kaye raising the target price from $121 to $131. In a client report, Kaye stated:
"We believe that infrastructure bottlenecks (such as power supply and higher rack density cooling demands) seem to be helping vertiv holdings gain competitive advantages."
TD cowen analyst Michael Elias maintained a "buy" rating on vertiv holdings stocks and raised the target price from $115 to $141. However, Elias also warned in a client report:
"We believe that vertiv's long-term guidance is the most optimistic scenario, as it assumes that the ultra-scale demand environment will not deteriorate over the next five years, but we are skeptical about this."
Nevertheless, we remain encouraged by the strong performance of demand in 2025, as recent information indicates that at least three major ultra-scale datacenter companies will have demand in 2025 comparable to last year, and one company's demand is expected to accelerate.
Editor/ping
