Vertiv's Leadership in Data Center Cooling Market
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 6 days ago
0mins
Should l Buy VRT?
Source: Fool
- Surging Market Demand: Vertiv's new orders soared by 252% in Q4 2025, with backlog increasing by 109% to $15 billion, indicating strong market demand for its cooling solutions and positioning the company prominently in the rapidly growing AI infrastructure market.
- Strong Financial Performance: In 2025, Vertiv achieved a 26% organic sales growth, and its full-year diluted earnings per share (EPS) surged by 166%, reflecting the company's competitiveness in the cooling equipment sector and laying a solid foundation for future growth.
- Strategic Partnerships: Vertiv's collaboration with Nvidia to provide advanced liquid cooling systems for data centers further solidifies its leadership in the cooling industry, while historical partnerships with companies like Equinix enhance its market influence, showcasing the broad applicability of its products.
- Optimistic Industry Outlook: According to Grand View Research, the data center cooling market is expected to grow at a compound annual growth rate (CAGR) of 22.3% from 2026 to 2033, reaching a market size of $128.31 billion by 2033, positioning Vertiv favorably to capitalize on this growth trend due to its experience and technological advantages.
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Analyst Views on VRT
Wall Street analysts forecast VRT stock price to fall
17 Analyst Rating
15 Buy
2 Hold
0 Sell
Strong Buy
Current: 251.070
Low
195.00
Averages
206.07
High
230.00
Current: 251.070
Low
195.00
Averages
206.07
High
230.00
About VRT
Vertiv Holdings Co. provides mission-critical digital infrastructure technologies and lifecycle services primarily for data centers, communication networks, and commercial and industrial environments. The Company operates in three business segments: the Americas; Asia Pacific, and Europe, Middle East & Africa. The Company's offerings include alternate current (AC) and direct current (DC) power management, thermal management, low/medium voltage switchgear, busbar, air cooled and liquid cooled thermal management products, integrated modular solutions, racks, single phase UPS, rack power distribution, rack thermal systems, configurable integrated solutions, energy storage solutions, hardware, software for managing IT equipment, management systems for monitoring and controlling digital infrastructure, and services. It also provides preventative maintenance, acceptance testing, engineering and consulting, remote monitoring, training, spare parts, specialized fluid management, and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Semiconductor Resilience: While the software sector faced sell-offs, the semiconductor industry remained robust, with the Russell 1000 Semiconductor Index diverging sharply from the software sector, indicating strong demand for physical AI infrastructure.
- Growing Infrastructure Demand: Companies like Vertiv and Amphenol benefit from AI's cooling and connectivity needs, underscoring the increasing importance of infrastructure roles within the AI ecosystem, suggesting future investments will prioritize these durable demands.
See More
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- Software Sector Adjustment: The software industry has faced a sell-off as the market reprices companies, questioning the viability of those that remain unprofitable amidst rapid AI advancements, impacting both good and bad companies alike.
- Infrastructure Demand Surge: Data center cooling companies report record backlogs, indicating sustained demand for physical AI infrastructure, while long-term contracts for enterprise AI tools provide revenue visibility, bolstering market confidence.
- Portfolio Restructuring: Future AI investment portfolios will focus more on infrastructure rather than concentrated tech bets, with companies like Vertiv and Equinix benefiting from their critical roles in data centers and internet infrastructure, highlighting the market's emphasis on durable demand.
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- Lumentum's Strong Performance: Lumentum's stock has surged approximately 116% this year, with a current market cap of $49 billion, primarily driven by Nvidia's $2 billion investment aimed at advancing optical networking products, highlighting its critical role in scaling AI factories.
- EchoStar's Growth Potential: EchoStar's stock has skyrocketed 360% over the past 52 weeks, although it has only risen 13% this year; its position in the communication services sector allows it to benefit from the S&P 500's influence, attracting more investor attention.
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- Technical Analysis Tool: Comparing the latest share price to the 200-day moving average provides valuable insights for investors, helping to assess market trends and potential buying opportunities.
- ETF Unit Trading Mechanism: ETFs trade similarly to stocks, where investors buy and sell 'units' that can be created or destroyed based on investor demand, impacting liquidity and market performance.
- Inflows and Outflows Monitoring: Weekly monitoring of changes in shares outstanding helps identify significant inflows (new units created) or outflows (old units destroyed), which can influence the performance of individual stocks held within the ETF.
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- Trump's Policy Extension: Despite Trump's extension of a deadline, the market's muted response indicates that geopolitical risks overshadow policy stability, reflecting investor concerns about future uncertainties.
- Tech Stocks Decline: The downturn in shares of tech giants like Meta, Microsoft, and Google suggests a waning investor confidence in the tech sector, which could adversely affect overall market performance and trigger broader sell-offs.
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See More
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- Outstanding Market Performance: Credo Technology Group and Vertiv have achieved over 1,000% stock price growth in the past three years, highlighting their critical roles in the AI data center supply chain and attracting investor interest.
- Buying Opportunity: Despite a 30% drop in Credo's stock price to around $100 in 2026, the strong demand for its high-bandwidth connectivity components makes it an appealing buy-the-dip target.
- Sales Growth Expectations: Credo's annual sales are projected to soar 204% in fiscal 2026 from $436.77 million to $1.33 billion, reflecting its immense potential in the AI data center market.
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