Investor Day "opens up the imagination space," "data center liquid cooling leader" Vertiv surges

Investor Day received positive feedback, and the stock price of data center equipment and service provider Vertiv soared.

During the Investor Day on Monday, November 18, Vertiv showcased its latest technologies, reaffirmed its goals for 2024, and provided sales outlooks for 2025, all exceeding market expectations.

Vertiv raised its long-term sales growth and profit margin targets for this year through 2029, expecting a long-term revenue CAGR of 12% to 14% and an operating profit margin of 25%. Previously, Vertiv had projected a long-term revenue CAGR of 8% to 11% and an operating profit margin of over 20%.

Additionally, Vertiv increased its regular annual cash dividend by 50%, from $0.10 per share to $0.15 per share, payable quarterly.

Vertiv's impressive outlook during the event left a deep impression on Wall Street, and after the event, Vertiv's stock price surged, receiving bullish reports from multiple Wall Street institutions.

On Tuesday, Vertiv rose over 14%, closing at $140.94 per share.

Vertiv: Data centers will triple by 2029

As a company focused on data center infrastructure, Vertiv provides critical technologies such as power management and thermal control systems, widely used in data centers, communication networks, and other places requiring stable power support.

Therefore, the market demand for data centers is crucial for Vertiv.

During Investor Day, Vertiv stated that they expect to add 100GW of data centers from 2023 to 2029, while currently, global data centers only amount to 40GW.

Vertiv also anticipates that the value of traditional data centers is $2.5-3 million/MW (1GW=1000MW), while the value of high-density data centers is $3-3.5 million/MW, indicating market space between the two.

Currently, Evercore ISI analyst Amit Daryanani and Oppenheimer analyst Noah Kaye reiterated their "outperform" rating on Vertiv stock, with Kaye raising the target price from $121 to $131. Kaye stated in a client report:

“We believe that infrastructure bottlenecks (such as power supply and higher rack density cooling demands) seem to be helping Vertiv gain a competitive advantage.”

TD Cowen analyst Michael Elias maintained a "buy" rating on Vertiv stock and raised the target price from $115 to $141. However, Elias also cautioned in a client report:

“We believe Vertiv's long-term guidance is the most optimistic scenario, as it assumes that the hyperscale 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 our recent information indicates that at least three major hyperscale data center companies will have demand in 2025 that is on par with last year, with one company's demand expected to accelerate growth