10 Best Stocks to Buy and Hold For 3 Years

7. Vertiv Holdings Co (NYSE:VRT)

Number of Hedge Funds: 91

Vertiv Holdings Co (NYSE:VRT) specializes in providing essential technologies and services for digital infrastructure. Its products are critical for the high-growth AI and data center industry as they power, cool, and secure data centers. The company also provides integrated rack systems and management systems that allow businesses to monitor and control their digital infrastructure.

As data centers evolve, liquid cooling systems are becoming increasingly important. Vertiv Holdings Co (NYSE:VRT) is gaining market share in this area by focusing on high intellectual property components like cooling distribution units (CDUs) and complete systems. On November 19, the company announced a significant expansion of its liquid cooling product portfolio with the introduction of two new high-capacity (CDUs). The new CDUs are designed to accommodate the high-density computing demands associated with AI applications, allowing data centers to efficiently manage both traditional air-cooled racks and advanced liquid-cooled systems.

As a result of its robust portfolio, the company is experiencing a significant increase in its order backlog. Its backlog at the end of the second quarter of 2024 stood at $7.0 billion, indicating a 47% increase in comparison to the previous year. The backlog only continued to increase during the third quarter to reach $7.4 billion, indicating a 5% increase from the previous quarter. In addition, Vertiv Holdings Co’s (NYSE:VRT) organic sales were also up 19.2% year-over-year driven by double-digit growth in all three regions. Management has taken confidence from its growing order backlog to raise its full-year guidance for all metrics. It now expects organic sales of $7.8 billion up $140 million from the previous expectation. It is one of the best stocks to buy and hold for 3 years.

Baron Small Cap Fund stated the following regarding Vertiv Holdings Co (NYSE:VRT) in its Q3 2024 investor letter:

“Vertiv Holdings Co (NYSE:VRT) is a leader in data center equipment, with significant share in both power and cooling applications. The stock rebounded off recent weakness, as investors gained confidence that a massive build out of AI data centers globally was on the horizon. Vertiv’s strong relationship with chip manufacturers and involvement in the necessary technology roadmap for solutions as the energy density of server racks increases were catalysts. Vertiv’s orders were up 57% year-over-year in the second quarter, backlog was $7 billion, a record, and 2024 operating profit margin and EPS guidance was raised.”