Vertiv Holdings is a global pure-play in critical digital infrastructure — the power and thermal-management gear that keeps data centres, communication networks and other mission-critical facilities running. Its range spans AC/DC power, uninterruptible power supplies, switchgear and busway, precision cooling (including the high-density liquid-cooling systems that AI server racks now demand), integrated racks and modular/prefabricated data-centre builds, plus monitoring and management software — sold under the Liebert, NetSure, Geist, E&I, Powerbar and Avocent brands. Around that hardware sits a large lifecycle-services arm (deployment, preventative maintenance, remote monitoring, spares) that recurs. What sets Vertiv apart is being one of only a handful of vendors that can supply an integrated power-plus-thermal-plus-services stack at hyperscale — a position that puts it squarely in the path of the AI data-centre buildout. Think of it as the 'picks-and-shovels' supplier to the compute boom: it doesn't make the chips, it makes almost everything around them that has to work for the chips to run.
donotbuy_checked_hold.Lifecycle: high-growth industrial compounder. Vertiv is a rare thing in Industrials — a mature-margin business still growing revenue ~20%+ organically. Q2 2026 (reported 29 Jul) put net sales at $3,274m, +24% y/y (+18% organic), GAAP diluted EPS $1.27 (+53%) and adjusted diluted EPS $1.52 (+60%), with adjusted operating profit +51% y/y and continued margin expansion. Operating margin was ~19.5% (op income $637.9m). The one blemish — revenue landed below the ~$3.37bn consensus (organic +17.8% vs +23.6% expected) on what management called temporary supply-chain congestion and lumpy, multi-phased project execution — is a timing issue, not a demand issue: backlog is ~$15bn and full-year guidance was raised.
| Sub-signal | Reading | Score |
|---|---|---|
| Revenue trajectory | +24% y/y (+18% organic), FY26 guide ~31% organic midpoint — elite for an industrial | 90 |
| Profitability vs peers | Op margin ~19.5% and expanding; adj op profit +51% y/y — top-tier for electrical equipment | 84 |
| Cash generation | FCF/OCF ~0.89; P/OCF ~25x; FCF per share ~$8.9 TTM — converts well | 78 |
| Balance sheet | Net debt low, debt/equity 0.68, interest coverage ~38x, current ratio 1.38 — healthy | 80 |
| Backlog / book-to-bill | Backlog ~$15bn, book-to-bill >1 — multi-year demand visibility | 88 |
Margin expansion through a supply-constrained cycle shows real pricing power on differentiated thermal/power kit.
N/A for hardware — scored neutral.
Once designed into a hyperscaler's data-centre reference architecture and tied to a service contract, Vertiv is embedded for the facility's life.
Scale, global manufacturing/service footprint and vertical integration in power + thermal; replicable by Schneider/Eaton at their scale.
Liebert/Avocent brand equity, deep engineering IP in high-density liquid cooling, and installed-base data.
Moat average ~69 (network-effects neutralised). A wide-enough moat, but not impregnable — the competitive read below sets switching-cost and cost-advantage scores.
| Competitor | Overlap | Relative position | Share trajectory |
|---|---|---|---|
| Schneider Electric (EPA:SU) | Largest overlap — power, EcoStruxure, prefab/modular data centres, cooling (Motivair) | The scale leader; broadest portfolio and biggest balance sheet | Both growing; Vertiv holding/gaining in thermal |
| Eaton (NYSE:ETN) | Electrical power management, UPS, switchgear, busway | Broad electrical major with big data-centre exposure | Both gaining with the buildout |
| nVent Electric (NYSE:NVT) | Enclosures, busbar, and a fast-growing liquid-cooling / data-solutions line | Smaller, more focused; leaning into liquid cooling | Rising, but from a smaller base |
Read-through to the moat: Vertiv's share gains in liquid cooling support the switching-cost (78) and cost-advantage (70) sub-scores; the crowded field is why neither reaches the 90s.
The whole story sits in this pillar. Vertiv is an outstanding business at a demanding price. After the ~28% post-earnings drop the multiple has compressed a lot — but it is still Expensive on the disciplined warranted-multiple anchor, which is why the signal stays capped at HOLD.
| Lens | Reading | Verdict |
|---|---|---|
| Warranted anchor (40%) | 37x fwd vs 24x warranted = 1.52x | Expensive |
| Sector median (20%) | Well above the Industrials/electrical-equipment median P/E | Rich |
| Own 5-yr history (15%) | ~37x fwd is off the 2025 highs but still upper-half of range | Full |
| PEG (10%) | PEG ~1.5 fwd (P/E 37 vs ~25% FY27 growth) — not egregious for the growth | Fair-ish |
| Analyst consensus (15%) | Median target $355, consensus $357 (+46%), 19 Buy / 1 Hold | Bullish |
The tension is stark: the market (consensus $355–357) is paying up for 25–30% growth, while the disciplined anchor implies intrinsic fair value nearer ~$200 (24x on FY26 adj EPS, ~$205 on FY27). The premium above the anchor is the growth bet — genuine, but it is a bet, and a top-line miss just reminded the market that even secular growth is lumpy. Valuation score 38 (Expensive band, up from 32 as the ratio fell from ~2.0x to 1.52x). A Full/Expensive name is never amplified to STRONG BUY.
Vertiv is tethered to the single most powerful driver in the book: the AI data-centre buildout. Every incremental gigawatt of AI compute needs power distribution, UPS, switchgear and — increasingly — liquid cooling, and Vertiv supplies all of it. Q2's ~$15bn backlog, >1 book-to-bill and a raised ~31% organic FY26 growth guide are the driver made concrete. This is why the driver score is 86 — the highest-conviction structural tailwind we track.
| Horizon | Driver read | Effect |
|---|---|---|
| Short (1–3 mo) | Hyperscaler capex still rising; the Q2 'miss' was timing, not cancellation — but the tape is jittery on any AI-capex wobble | Tailwind (amp blocked by HOLD) |
| Medium (6–12 mo) | Backlog conversion + liquid-cooling attach rate expanding as racks densify | Strong tailwind |
| Long (3–5 yr) | Multi-year AI + digitalisation infrastructure super-cycle; Vertiv a prime picks-and-shovels beneficiary | Strong tailwind |
Amplification note: a driver this strong would lift a BUY to STRONG BUY — but the base signal is HOLD (Valuation-Ceiling), and HOLD never amplifies. The driver's real job here is to keep the long-term thesis intact through the valuation reset.
Industrials (XLI) reads Outperform (short) / Outperform (medium) / Strong-Outperform (long) in the latest Macro-Economic report (2026-07-30) — the most supportive sleeve tier. Within that, Vertiv sits on the AI-data-centre-power sub-theme, a structural tailwind that runs longer than the industrial cycle. Net macro pressure is a Tailwind and a long entry is Trend-Following (you are leaning with both the sector signal and the secular driver), conviction ~70. The one macro caveat is that Vertiv is the AI-capex trade, so a genuine hyperscaler-capex slowdown would hit it first and hardest — carried in the Bear.
Source: sector-map · Macro report 2026-07-30
A capitulation and a first bounce. Vertiv fell from a $376 May high to a $223 post-earnings low (27–28 Jul, on ~21m-share volume) — a classic AI-cohort de-rating plus a top-line-miss flush — and is now repairing, up ~+7.5% today to ~$244.66, right at its 200-DMA (~$246). The daily trend is still down (RSI hit ~29 oversold; price well below the 50-DMA ~$307), but the weekly trend remains up and the hourly/intraday structure has flipped to recovering. So: better entry level, constructive first bounce, but no confirmed trend reclaim yet.
| Element | Reading |
|---|---|
| Risk / reward from $244.66 | To base $340 = +39%; to bear $190 = −22% → ~1.8:1, much improved after the drop |
| Relative strength | Sharp underperformance into the print; now stabilising — needs to hold $223–227 to confirm a low |
| Key levels | Support $223/$227 (post-earnings low); pivot $246 (200-DMA); resistance $307 (50-DMA), then $358/$376 |
| Sentiment / catalyst | Guidance raise is a positive counter-catalyst; 19 Buy / 1 Hold, no downgrades post-print (RBC, KeyBanc, Citi reiterated) |
Timing score 54 — a notch better than 23 Jul (52). The improvement is the cheaper level and the oversold bounce; the cap on it is the broken daily trend and unconfirmed low.
| Date | Event | Impact | Forecast | Previous | Relevant? | Why |
|---|---|---|---|---|---|---|
| 2026-08-01 | US Jobs / ISM Mfg | High | — | — | Indirect | Industrial-cycle read; risk-appetite for high-beta AI names |
| 2026-08-13 | US CPI | High | — | — | Indirect | Rate path feeds the discount rate in the warranted anchor |
| late Oct 2026 | Vertiv Q3 2026 earnings | High | — | — | Direct | The key test: does the Q2 timing miss reverse and organic growth re-accelerate? |
| Date | Event | Actual | Forecast | Surprise | Impact |
|---|---|---|---|---|---|
| 2026-07-29 | Vertiv Q2 2026 | Rev $3.27bn; adj EPS $1.52 | Rev ~$3.37bn; adj EPS $1.42 | Rev miss / EPS beat | Stock -~10% then bounced |
| 2026-07-29 | FY26 guidance | Adj EPS $6.65-6.75 (raised) | $6.30-6.40 prior | Raise | Positive counter to the revenue miss |
The event that mattered has passed — Q2 on 29 Jul, a top-line miss but an EPS beat and a full-year raise. The next direct catalyst is Q3 in late October; between now and then the stock trades on the AI-capex tape.
| Timeframe | Trend | Direction | RSI | MACD | Key S/R | Breakout | Vol |
|---|---|---|---|---|---|---|---|
| Monthly | Uptrend | Up | 59.6 | + (hist +11.1) | S 53.6 / R 379.9 | Resistance breakout | 0.8x |
| Weekly | Uptrend | Up | 43.1 | − (hist −11.6) | S 158.8 / R 358.5 | Above 50-wk (228) | 1.7x |
| Daily | Downtrend | Down | 28.8 | − (hist −7.8) | S 223 / R 307 | Support breakdown | 2.5x |
| Hourly | Recovering | Up | 61.3 | + (hist +1.5) | S 233 / R 273 | Reclaim in progress | — |
| 15-min | Strong uptrend | Up | 57.0 | ~flat | S 238 / R 252 | Above intraday MAs | — |
| Confluence: Split — long-term up, short-term repairing off oversold · MTF Score 52 | |||||||
The timeframes disagree, which is exactly what a post-capitulation bounce looks like: monthly/weekly still up (the secular trend), daily broken and oversold (the earnings flush), hourly/15-min recovering (the bounce). A hold of $223–227 and a reclaim of the 200-DMA (~$246) would start to knit the daily back to the weekly; failure there re-opens the downside toward the bear.
Vertiv daily close (last ~4 months) with 50-DMA. The $376 May high, the run lower, and the late-July capitulation to $223 on the Q2 revenue miss, now bouncing to ~$245 at the 200-DMA.
The timing shifts prove entirely transitory; Q3/Q4 re-accelerate organic growth back toward 25%+, backlog keeps compounding, and the multiple re-expands toward ~45x on FY27 adj EPS (~$8.50) as the AI-capex fear fades. ~+84% from $244.66. Roughly the Street high ($500) territory.
Most likely. Vertiv delivers on the raised FY26 guide (adj EPS $6.65-6.75, ~31% organic), the supply-chain congestion clears over 1-2 quarters, and the multiple settles around a still-premium ~40x on FY27 EPS. Lands near the consensus/median target band ($355-357). ~+39% from here, but capped at HOLD because the entry multiple is Expensive today.
The AI-capex cohort de-rates further and the top-line miss hardens into a demand-digestion narrative (project pushouts, share checks soften). Multiple compresses to ~28x on FY26 adj EPS -> ~$190, roughly the analyst low ($277) undershot. This is the mandated cohort / data-centre-capex-slowdown leg: as the purest AI-capex name, Vertiv leads the group down if the buildout stalls. ~-22% from here.
Probability-weighted fair value ≈ $332 (0.25×450 + 0.55×340 + 0.20×190). Above today's $244.66 — the expected value is positive — but the entry multiple is Expensive, so the framework holds rather than buys: you want either a cheaper price or proof the growth re-accelerates before paying up.
Forecast: No path is open today (Wait). The fastest realistic opener is the Technical group — either a confirmed higher-low that holds $223–227 over the next 1–2 weeks, or a reclaim of the 50-DMA (~$307) — but note that even a clean technical entry only lifts the signal to HOLD while the Valuation-Ceiling gate is live. The Fundamental path needs either a drop toward the ~$200 anchor or a growth re-acceleration that lifts the warranted multiple.
Forecast: No exit trigger is live — hold. The $205 stop sits ~16% below spot; thesis remains intact (backlog ~$15bn, guidance raised).
No allocation or portfolio role was specified for this refresh, so position sizing is not computed. As a framing note only: a HOLD on an Expensive name is a 'no fresh capital' read — not a reduce — and any new entry would be a starter given the single open path required and the live Valuation-Ceiling gate.
{
"ticker": "VRT",
"date": "2026-07-31",
"time": "1200",
"version": "v6",
"exchange": "NYSE",
"exchange_ticker": "NYSE:VRT",
"isin": "US92537N1081",
"api_ticker": "VRT",
"company": "Vertiv Holdings Co",
"currency": "USD",
"sector": "Industrials",
"gics_sector": "Industrials",
"sub_industry": "Data-centre power & cooling",
"country": "United States",
"lifecycle_stage": "high-growth",
"price_at_rating": 244.66,
"signal_short": "HOLD",
"signal_medium": "HOLD",
"signal_long": "HOLD",
"primary_signal": "HOLD",
"quality_score": 80,
"valuation_score": 38,
"timing_score": 54,
"driver_score": 86,
"overall_confidence": 58,
"economic_alignment_stance": "Trend-Following",
"economic_alignment_conviction": 70,
"economic_alignment_pressure": "Tailwind",
"economic_alignment_source": "sector-map",
"macro_report_date": "2026-07-30",
"val_multiple_basis": "forward P/E on FY26 adj EPS (Expensive)",
"warranted_multiple": 24,
"actual_multiple": 37,
"warranted_ratio": 1.52,
"val_band": "expensive",
"sector_guardrail_multiple": 23,
"discount_rate_r": 9.0,
"risk_free_10y": 4.5,
"g_near": 15,
"g_term": 3,
"trailing_pe": 55,
"forward_pe": 37,
"nonop_pct_of_net_income": 3,
"clean_pe": 55,
"competitive_share_trajectory": "gaining",
"competitive_threat_level": "moderate",
"driver_commodity_trend": null,
"hard_gate_state": "donotbuy_checked_hold",
"gates_triggered": [
"Valuation Ceiling (Expensive: ~37x fwd adj vs 24x warranted, 1.52x; >= 23x Industrials floor)"
],
"gates_caution": [
"AI-capex-cohort cyclicality / demand-digestion risk",
"DNB Trigger 2 checked - not fired (no longer >2x warranted; AI tail armed-not-triggering)"
],
"do_not_buy_triggers": [],
"dnb_arm_b_checked": "Not fired. VRT is the purest AI-capex-cohort name, but (a) valuation is no longer VERY Expensive (1.52x warranted, was ~2.0x on 23 Jul / ~3.4x on 9 Jul) after the ~28% post-earnings drop, so arm (a) fails; and arm (b) needs the AI-concentration systemic tail LIVE, which remains armed-not-triggering (breadth broadening per macro 2026-07-30). Cohort de-rating carried as a section-11 bear leg (multiple compression to ~28x -> ~190). Consistent with [[armed-not-triggering-tail-hold-not-dnb]].",
"entry_groups_met": 0,
"entry_conviction": "Wait",
"exit_groups_live": 0,
"exit_action": "Hold",
"short_entry_confirmed": false,
"short_cap_reason": "Short HOLD - Expensive (Valuation-Ceiling gate) caps the base signal regardless of Quality/Timing; price is repairing off a capitulation low but still below the 50-DMA (307) with the daily trend down. No entry group met (Wait).",
"fair_value_est": 340.0,
"stop_loss": 205.0,
"target_price": 340.0,
"scenario_base_target": 340,
"scenario_bull_target": 450,
"scenario_bear_target": 190,
"analyst_consensus_target": 357.47,
"analyst_target_high": 500,
"analyst_target_low": 277,
"analyst_target_median": 355,
"analyst_target_upside_pct": 46.1,
"analyst_grades_consensus": "Buy",
"analyst_bullish_pct": 95,
"analyst_coverage_count": 20,
"fmp_rating": "B",
"fmp_overall_score": 3,
"q2_2026": {
"revenue_musd": 3274.3,
"revenue_yoy_pct": 24,
"organic_yoy_pct": 18,
"gaap_dil_eps": 1.27,
"adj_dil_eps": 1.52,
"adj_eps_yoy_pct": 60,
"op_income_musd": 637.9,
"op_margin_pct": 19.5,
"adj_op_profit_yoy_pct": 51,
"revenue_miss": "vs ~3.37B consensus (organic +17.8% vs +23.6% expected)",
"backlog_busd": 15.0,
"book_to_bill": ">1"
},
"fy26_guidance_raised": {
"net_sales_busd": 14.0,
"organic_growth_pct": 31,
"adj_dil_eps": "6.65-6.75"
},
"next_update_date": "2026-08-14",
"next_update_basis": "default +14d (Q2 digested; watch AI-capex tape + timing-shift resolution; Q3 print ~late Oct)",
"next_check_date": "2026-08-14",
"analysis_status": "on-going",
"finder_ticker": "VRT",
"finder_exchange": "US NYSE",
"prior_report": "calibration-VRT-20260723-1730.json",
"prior_primary": "HOLD",
"report_filename": "VRT_Signal_v6_20260731_1200.html"
}
HOLD/HOLD/HOLD held. Valuation improved Very-Expensive -> Expensive (1.52x warranted) on the ~28% drop + raised guide, lifting the Valuation score 32->38, but the Valuation-Ceiling gate still caps the signal. DNB Trigger 2 checked, not fired.