Vertiv Holdings (VRT): AI Server Cooling Tech and Stock Potential

This site is a great place for me (@mifsee(2) has been working on company and stock analysis while learning privately.

This is only a record of my personal analysis and the contents may contain errors or information that differs from the actual situation. Please understand in advance when viewing this site.

Introduction.

With the development of AI,NVIDIAAt the same time, the market for semiconductors for AI, such assuper microcomputerand Dell Technologies, Inc. are also rapidly expanding their demand for AI servers.

The next phase of AI evolution will see the development of these high-performance semiconductors and infrastructure such as servers, and the spread of specific AI services.
This is expected to lead to further advances in the form of direct applications in human life, such as drug discovery, medicine, and finance, while facing realistic power supply and security issues.

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At this stage, the demand for infrastructure is growing and many issues related to server demand need to be resolved.
In this context, Vertive Holdings is positioned as an advanced leader, especially in cooling technology, and is expected to grow significantly.

In this section, we delve deeper into Vertive Holdings' business, its unique strengths, and its future prospects, and discuss the outlook for the company's stock price.

What is Vertive Holdings and what kind of business does it do?

• Vertiv Holdings Co,Designs and manufactures critical infrastructure technologies for data centers, telecommunications networks, and commercial and industrial facilities,and a global company specializing in the provision of services.
  In particular, the company offers power, cooling, and IT infrastructure solutions and related services that help customers' applications run continuously, function optimally, and grow.
• The company has manufacturing sites and service centers around the world and employs approximately 27,000 people.
  and, ,Vertive is especially known for its advanced thermal management solutions and uninterruptible power supplies (UPS) for data centers, which offer high reliability and efficiency.
• Other infrastructure management solutions such as IT remote management and monitoring systems are also widely adopted and play an important role in supporting corporate IT operations.
• Vertive's focus on continuous R&D and innovation and the development of new technologies will enable the company to maintain its market leadership and enable customers to respond to changing market demands and increase the sustainability of their businesses.

Corporate information on Vertive Holdings is below.

• Company Name: P.O. BoxVertiv Holdings Co.
• Date of Establishment: (Months)January 2016
• Name of Representative:.Giordano Albertazzi
• Official website:.https://www.vertiv.com/jp-asia/

What are Vertive Holdings' (VRT) main products and services?

Vertive Holdings offers the following core products and services

Uninterruptible Power Supply (UPS)

Vertive is especially known for its Liebert® brand UPS series.
These UPSs provide high power efficiency and reliability to help protect mission-critical infrastructure.They are particularly suited to data centers and edge computing environments, and a variety of models are available to meet corporate needs.

Cooling Solutions for Data Centers

Thermal management solutions for effective data center temperature control, including Liebert® computer room air conditioning systems.They feature designs that maximize data center efficiency and minimize operating costs.

IT Management Solutions

Under the Avocent® brand, the company offers products such as remote management software and KVM switches (keyboard, video, and mouse switchers). It enables remote device management and improves the operational efficiency and security of IT infrastructures.

Rack PDUs and intelligent monitoring systems

Geist™ brand rackmount PDUs (power distribution units) and environmental monitoring systems will also be one of the main products. These help manage the power supply and environmental conditions within the data center to maintain system stability and efficiency.

These products and services are part of Vertive Holdings' solutions for data centers, telecommunications networks, and other commercial facilities that are essential to the continuity and efficiency of a company's digital infrastructure.

What is the business model of Vertive Holdings (VRT)?

Vertive conducts its business through the following key activities

Product Sales

The company provides uninterruptible power supplies (UPS), racks and enclosures, thermal management systems, power distribution units (PDUs), and other products for data centers and telecommunications networks, and derives significant revenue from the sale of these products.

Service Offerings

Provide product installation, maintenance, repair, and monitoring services, an important revenue source to build long-term customer relationships and increase customer retention of use.

Software and Digital Solutions

Provides power and thermal management software, remote monitoring and management software, and cloud-based management tools to help customers optimize operations, reduce costs, and improve system uptime.

consulting

Provide consulting services to optimize data center and network infrastructure operations and assist customers in their transition to informatization and automation.

Vertive also invests heavily in R&D and remains competitive by continually introducing new and innovative products in response to market changes.

This investment maintains the foundation for the company to compete at the forefront of technology and provide its customers with the latest solutions.

What's so great about Vertive Holdings (VRT)?

Vertive Holdings has established a competitive advantage through its innovative technology, broad product line, global reach, commitment to sustainability, and investment in research and development.

The company provides critical infrastructure for data centers and telecommunications networks, specifically energy-efficient and reliable power and thermal management technologies that reduce customers' operating costs and minimize environmental impact.

The company's cooling technology is of particular importance in the AI server market, where demand is rapidly increasing as AI technology evolves. In addition, the company's aggressive investment in R&D has enabled it to maintain its leadership in the data center industry and other industries by providing new products that meet market needs in a timely manner.

Who is Vertive Holdings (VRT)'s customer base?

Vertive Holdings has a diverse customer base.

• Data CentersLarge enterprises and cloud service providers are the primary customers, and these organizations operate in environments that demand high reliability and efficiency. The power management, cooling solutions, and monitoring systems offered by Vertive are critical to the sustainable operation of their data centers.
• Communication NetworksThese customers include telecommunications carriers and Internet Service Providers (ISPs), who rely on Vertive's solutions to maximize the availability and efficiency of their communications infrastructure.
• Commercial and industrial facilities:.A wide range of industries fall into this category, including manufacturing, energy, and transportation. These companies require reliable power supply and environmental management to ensure continuity of manufacturing processes and operations.
• Government:.Critical national and local government facilities are also Vertive's customers, and these organizations require reliable infrastructure for public safety and service delivery.
• Educational and medical facilities:.Schools, universities, and hospitals also use Vertive's products, and these facilities must protect research data and secure patient information systems.

These customers demand high reliability, sustainability, and cost efficiency, and Vertive meets their requirements in a wide range of industries by providing customized solutions to meet their needs.

What is the trading market?

Vertive Holdings is listed on the New York Stock Exchange (NYSE) under the ticker symbol "VRT".

What are the sectors, industries, and themes to which Vertive Holdings (VRT) belongs?

sector

Industrial: IndustrialVertive Holdings is part of the Industrial sector, providing critical infrastructure technology and services primarily for data centers, telecommunications networks, and commercial and industrial facilities.

type of industry

Electrical equipment and components:.Vertive specializes in the design and manufacture of electrical equipment and components, including power management products, thermal management products, and integrated rack systems.

Themes belonging to

Digital Infrastructure and Sustainability: TheVertive's business focuses on building and maintaining digital infrastructure and promoting sustainability through energy efficient solutions.

When was Vertive Holdings (VRT) incorporated and listed?

Vertiv Holdings Co, originally the network power division of Emerson Electric, was acquired by Platinum Equity in 2016 and rebranded as the independent company Vertiv.
Subsequently, on February 10, 2020, the company was listed on the New York Stock Exchange (NYSE) as "VRT" following its merger with GS Acquisition Holdings.

Dividends?

• Vertive Holdings currently pays a quarterly dividend.
• Dividend yield is 0.11%.

What is the size and growth potential of the industry to which Vertive Holdings (VRT) belongs?

The data center infrastructure market, of which Vertive Holdings is a part, is currently one of the very fastest growing industries.

Market size of approximately $19.481 billion in 2022 and projected to grow at a compound annual growth rate (CAGR) of 10.9% through 2030The growth of the market is estimated to be This growth is attributed to the growing adoption of cloud computing, the increase in digital services, and the growing demand for technological advances.
Hyperscale data centers are particularly important for providing the massive amounts of computing power and storage capacity demanded by technologies such as big data analytics, artificial intelligence (AI), and machine learning, and the market for these data center types is expected to continue to grow.

Data center market growth is led by North America, where the region is characterized by a high concentration of technology companies and cloud service providers. Large companies such as Amazon, Google, and Microsoft are driving demand for data center infrastructure.

Like this,The data center market is expected to continue to grow, and this growth will be further accelerated by the advancement of digitalization, cloud computing, and increased use of AI.

For companies like Vertive Holdings, the growth of this market offers significant business opportunities.

What is Vertive Holdings' (VRT) innovation in cooling technology?

Vertive Holdings' cooling technology focuses specifically on increasing the efficiency and sustainability of data centers.

In 2023, the company will strengthen its liquid cooling technology portfolio through the acquisition of CoolTera Ltd. a provider of liquid cooling infrastructure solutions, particularly in the design and manufacture of cooling distribution units (CDUs), secondary fluid networks (SFNs), and manifolds. The company has a proven track record.
This technology,Provide advanced cooling technologies and systems to support high-density calculations, enabling data centers to more efficiently support high rack densities.

Vertive will also showcase the Liebert® XDU coolant distribution unit designed by CoolTera at the 2024 Data Centre World event, a new product suitable for chip cooling and rear door cooling applications.
These systems can also operate without the facility's water and can take advantage of the benefits of liquid-cooled servers without incurring the cost of major infrastructure changes.

These advances will further enhance Vertive's ability to address the energy efficiency and sustainability challenges faced by data centers and provide a foundation to support the deployment of high-density applications such as AI.

Thus, Vertive Holdings continues to innovate in the field of cooling technology, a factor that makes it competitive in the industry.

Who are some of Vertive Holdings' (VRT) competitors?

Vertive Holdings competes with several major competitors in the data center infrastructure management market.

Leading infrastructure management company

• Schneider Electric SE:.Schneider is a leader in the field of digital transformation, providing energy management and automation technologies. For data centers, the company is particularly focused on edge data center technologies.
• Johnson Controls International PLC [JCI]:.The company provides energy-efficient building management systems and uses its technology to manage data center infrastructure.
• Eaton (Eaton Corporation PLC) [ETN]:.Focused on providing power management solutions, the company is known for its data center power and backup solutions.

Specialized power management companies

• IBM (IBM Corporation) [IBM]:.It offers advanced IT infrastructure and cloud services and has a competitive edge in the data center market. The company is particularly strong in data management and analysis.
• Dell Technologies Inc [DELL]:.It offers complete data center solutions and is involved in storage, server, and networking equipment as well as data center design and operations services.

While each of these companies has different areas of expertise, they compete to provide solutions that increase the operational efficiency, reliability, and sustainability of data centers.

Vertive Holdings' strengths over these competitors include its unique high-density cooling solutions and custom cooling technology.

What are the differentiating factors and advantages of Vertive Holdings (VRT) over its competitors?

Vertive Holdings has several key differentiators and competitive advantages that set it apart in the marketplace.

• Investments in innovation and R&D:.Vertive continues to invest in industry-leading research and development to meet market needs through new products and technological innovations.
• Energy Efficiency and Sustainability:.The company offers products that take into account their environmental impact, especially deploying energy-efficient and sustainable power and thermal management systems. This allows customers to reduce operating costs and environmental impact.
• Global deployment and support:.Vertive operates in more than 130 countries, providing consistent service and support to customers worldwide. This extensive network enables Vertive to provide customers with the same quality and service regardless of geography.
• Customized solutions:.By providing personalized solutions tailored to the unique needs of its clients, Vertive has developed a close relationship with them. An experienced team of engineers supports the design, development, and implementation of efficient and reliable custom solutions.

These elements are the foundation for Vertive's success in the marketplace and differentiate it from its competitors.

What is the relationship between Vertive Holdings (VRT) and NVIDIA?

Vertive Holdings is participating in the NVIDIA Partner Network (NPN) as a "Solution Advisor: Consultant Partner".

The partnership aims to leverage Vertive's expertise in high-density power and cooling infrastructure to support the rapid adoption of AI workloads.

Specifically,The company is working with NVIDIA's leading-edge platform to develop advanced liquid cooling solutions for next-generation AI data centers.

Through this collaboration, Vertive uses its own liquid cooling technologies (e.g., Liebert XDU cooling distribution units and Liebert XDM indoor split chillers) to help GPUs run the most compute-intensive AI workloads safely and with optimal performance.

Through this partnership, Vertive is also expanding its offerings of solutions based on NVIDIA's technology to address the unique infrastructure challenges of accelerated computing needs.

What impact will Vertive Holdings (VRT) have on the development of AI?

Vertive Holdings (VH) is taking several important initiatives in response to the rapid development of AI (Artificial Intelligence) and its impact on data centers.

In particular, Vertive is enhancing its infrastructure solutions as AI increases the power and cooling requirements of data centers.

Providing AI-enabled infrastructure solutions

Vertive has developed a pre-engineered infrastructure solution specifically to support high-performance compute (HPC) and AI workloads. This includes power, cooling, enclosure, and lifecycle services, enabling faster deployment through digital management tools.

Innovative cooling technology

As a pioneer in liquid cooling technology, Vertive has introduced advanced cooling solutions such as direct chip cooling and submerged cooling (where the server is immersed in a non-conductive liquid).

These technologies are particularly well suited for AI and HPC applications, and can minimize energy efficiency and environmental impact.

Contribution to energy efficiency and sustainability

AI operations consume large amounts of power, and Vertive's solution addresses this by increasing energy efficiency and supporting sustainable operations.

In particular, the use of battery energy storage systems (BESS) will enable data centers to operate in a more environmentally friendly manner.

Through these efforts, Vertive Holdings is meeting the demands of data centers as AI technology evolves and strengthening its market leadership.

Vertive Holdings (VRT) Financial Results

Vertiv Holdings Co's financial year ends on December 31. Quarterly financial results are being released according to the following schedule.

• First quarter results: End of April
• Second quarter results: End of July
• Third quarter results: End of October
• Fourth quarter and full year results: end of February of the following year

First, we will review the following four indicators to perform a minimum performance analysis of Vertive Holdings (VRT).

1. Sales: An indicator of a company's performance and growth.
2. Operating Cash Flow and Operating Cash Flow Margin: Indicators that look at how much cash a company generates from its services. The margin is considered excellent when the ratio is 15%.
3. Operating Profit: Profit earned by a company from its core business. An indicator to evaluate a company's performance.
4. EPS: An indicator that looks at a company's earning power "profitability" and "growth potential" in terms of net income per share. The higher the number, the higher the earning power.

Each data is,Investing.com, ,TradingViewSee from

Vertive Holdings (VRT) Stock Price

View a real-time stock price chart (TradingView) showing the current stock price of Vertive Holdings (VRT).

The chart shows the Relative Strength Index (RSI). Reference as an indicator of market overheating.

*An overbought indicator when the RSI exceeds 70% to 80%, and conversely, an oversold indicator when the RSI falls below 20% to 30%.

VRT's Quarterly: Sales Trends

Quarterly sales forecasts and actual sales and year-on-year changes.

Sales forecasts and actual results are shown in graphs.

VRT's quarterly: operating cash flow trends

Quarterly operating cash flow and operating cash flow margin.

Each transition is shown in the graph below.

VRT's Quarterly: Operating Income Trends

Quarterly operating income.

Each transition is shown in the graph below.

VRT's quarterly: EPS transition

Quarterly EPS forecast and actual EPS.

Each transition is shown in the graph below.

VRT Full Year: Sales Trends

This is the sales forecast for the full year and actual sales and year-on-year changes.

Each transition is shown in the graph below.

VRT's full year: operating cash flow trends

Operating cash flow for the full year and operating cash flow margin.

Each transition is shown in the graph below.

VRT's Full Year: Operating Income Trends

Operating income for the full year.

Each transition is shown in the graph below.

VRT's Full Year: EPS Trends

This is the EPS forecast and actual EPS for the full year.

Each transition is shown in the graph below.

What is the future life of Vertive Holdings (VRT)? What are the future developments?

The future of Vertive Holdings is very promising, and a growth strategy for 2024 is specifically planned.

The company expects to accelerate its growth by strengthening its critical digital infrastructure offerings in the data center market, especially as demand for infrastructure to support AI (Artificial Intelligence) deployments increases.
Specifically, the plan is set at $7.515 billion to $7.655 billion in projected sales for all of 2024, which is expected to grow by 9.01 TP3T to 11.01 TP3T over the previous year.

Adjusted operating income is expected to range from $1.275 billion to $1.325 billion, and adjusted operating margin is expected to reach 16.91 TP3T to 17.31 TP3T.
These figures indicate a stronger competitive position within the industry and the maintenance of market leadership.

Further,In order to respond quickly to changes in the data center market, Vertive is increasing its support for liquid cooling technologies and high-density computing applications, which is contributing to increased demand, especially for AI-driven applications.
The firm also differentiates itself by maintaining strong client relationships and providing customized solutions.

These strategic initiatives form the foundation for Vertive Holdings to continue its sustainable growth and solidify its position as an industry leader well into the future.

Vertive Holdings (VRT) Q3 FY2024 Financial Results Summary

Sales and Revenues

• Net sales: Sales for the third quarter of 2024 were $2,074 million, a 19% increase over the same period last year.
• Operating income: $372 million and adjusted operating income of $417 million, up 48% and 41%, respectively, from the same period last year.
• Adjusted operating margin: 20.1%, up 310 basis points from the same period last year.

Increase in orders

• Organic Orders: Organic orders for the last 12 months were up 37% YoY. Q3 stand-alone organic orders were also up 17% YoY, with AI-related demand making a particular contribution.

Cash Flow

• Cash flows from operating activities: $375 million; adjusted free cash flow: $336 million.
• Net leverage and liquidity: Strong cash flow reduced net leverage to 1.4x and liquidity to $1.5 billion.

Performance by Region

• American market: Sales increased 19.5% yoy.
• EMEA markets (Europe, Middle East, Africa): Sales grew 26.1% y/y. AI-enabled cooling technology and data center demand fueled growth in all regions.

Future Guidance

• Q4 Sales Forecast: $2,115 million to $2,165 million; adjusted operating income: $427 million to $447 million.
• Adjusted free cash flow forecast for full year 2024: Estimated to be between $975 million and $1,025 million.
• Bullish outlook: Both sales and profits are expected to continue to grow, and sustainable profitability will be achieved.

VERTIVE plans to maintain and grow its strong position in the data center field, backed by growing demand for infrastructure due to the spread of AI technology. Vertive plans to maintain and grow its strong position in the data center field.

Vertive Holdings (VRT) Q2 FY2024 Financial Results Summary

• Net sales: $1.953 billion, an increase of 131 TP3T over the same period last year.
• Operating income: $336 million, up 631 TP3T from $205.8 million in the same period last year.
• Adjusted operating income: $382 million, an increase of 521 TP3T over the same period last year.
• Adjusted operating margin: 19.61 TP3T, a 510 basis point improvement from 14.51 TP3T in the same period last year.

Major Business Developments

• order growth: 2Q orders increased by 571 TP3T YoY, and 371 TP3T year-to-date over the past 12 months.
• Strengths in the data center market: Vertiv's technology and services are playing an important role in the market as AI adoption grows, and we plan to continue to invest in capacity expansion and R&D to support the growth of AI acceleration.

Cash Flow and Financial Condition

• Operating Cash Flow: $378 million, up $125 million from the same period last year.
• Adjusted free cash flow: $333 million, an increase of $106 million from the same period last year.
• liquidity: The company maintains $1.2 billion in liquidity and has zero borrowings under its ABL credit facility.

Future Outlook

• Guidance for full year 2024:
  • Sales projections range from $7.59 billion to $7.74 billion.
  • Adjusted operating income was $1.41 billion to $1.46 billion and adjusted operating margin was 18.51 TP3T to 18.91 TP3T.
  • Adjusted free cash flow is expected to be in the range of $850 million to $900 million.

Vertive is expected to show strong growth in both sales and profits in the second quarter of 2024, especially in the data center market as demand for AI deployments increases. We expect sustained growth as we continue to expand our business performance and improve profitability.

Vertive Holdings (VRT) Q1 FY2024 Financial Summary

Vertive Holdings' Q1 2024 financial report shows solid growth for the company. Below are its key takeaways.

• Sales growthSales for the first quarter of 2024 were $1.639 billion, an increase of 81 TP3T over the same period last year.
• Profit increase: (1.0)Operating income for the quarter was $203 million, a significant increase from $131 million in the same period last year. Adjusted operating income was $249 million, an increase of 421 TP3T.
• Increased orders and backlog:.Organic orders increased by 601 TP3T y/y and the backlog reached an all-time high of $6.3 billion.
• Dividends and Stock Buybacks:.The company repurchased 9.1 million shares for approximately $600 million, realizing a return to shareholders.
• FY2024 Forecast Update:. The forecast was raised from $7.54 billion to $7.69 billion in sales and from $1.325 billion to $1.375 billion in adjusted operating income.

These results suggest that Vertive Holdings continues to perform well against a backdrop of growth in the data center market and advances in AI technology.

The company has further strengthened its market position by focusing on infrastructure development to meet the growing demand for AI technology, which continues to make the company attractive to investors and shareholders.

Which brokerage firms can I buy shares of Vertive Holdings (VRT)?

We have listed the major brokerage firms that offer shares in Vertive Holdings (VRT). At these brokerages, you can choose to invest as a CFD (Contract for Difference) in addition to direct share trading as a foreign stock.

I myself mainly use SBI Securities, but some stocks they handle may not be available for purchase. In such cases, I sometimes use CFDs at Saxo Bank Securities or IG Securities.

summary

We have delved into the details of Vertive Holdings' business, its unique characteristics, competitive advantages, and earnings growth.

Vertive Holdings' performance demonstrates its growth stage, with strong market demand and optimistic growth prospects.

In particular, its collaboration with NVIDIA is a noteworthy point, reinforcing its position as an AI-related stock.

A number of promisingNVIDIA related issuesexists, I am personally making steady progress with my VRT holdings and have great expectations for future growth.

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