Shares of Vertiv Holdings (VRT +1.13%) surged 20% higher this week through 11 a.m. Friday, according to data provided by S&P Global Market Intelligence. The stock hit a 52-week high $255.54 per share this week, more than doubling in one year.
While the broader market is wrestling with fears of an artificial intelligence (AI) bubble, Vertiv Holdings just proved that the core physical systems powering up AI data centers are in higher demand than ever.
Image source: Getty Images.
Vertiv's numbers reveal exponential growth
Vertiv Holdings' fourth-quarter numbers, released on Feb. 11, took the market by surprise. Vertiv reported 23% higher revenue and 27% higher operating profit for Q4, both year over year.
Even better, Vertiv's organic orders jumped 252% year over year in Q4, while its backlog more than doubled to a record $15 billion.
That's extraordinary growth. Demand for Vertiv's products is booming because the company holds a dominant position in power management as well as thermal cooling systems. Its dominance addresses the two biggest pain points for data centers: the need for uninterrupted power supply and the challenge of keeping massive cooling systems from buckling under the heat generated by servers.
NYSE: VRT
Key Data Points
Can Vertiv stock go any higher?
Vertiv is a cash-flow machine. It generated $1 billion in cash from operations and spent $1 billion on acquiring Purge Rite Intermediate in the fourth quarter. Purge Rite's flushing and filtration systems keep liquid cooling systems in data centers clean, maximizing performance and reducing the risk of downtime.
As the data center buildout accelerates, management has set a high bar for 2026. It expects 27% to 29% organic sales growth, net sales of $13.25 billion to $13.75 billion, and adjusted earnings of $6 per share at the midpoint, all substantially higher than analysts' estimates.
As long as AI chips run hot and data centers require power and cooling, Vertiv should grow, and so should its stock price.
