15 Best Data Center Stocks To Buy According to Jefferies, Citi and Wall Street Analysts

7. Vertiv Holdings Co (NYSE:VRT)

Average Analyst Share Price Target Upside: 56%

Average Analyst Share Price Target: $105.37

Number of Hedge Fund Investors  in Q1 2024: 85

Vertiv Holdings Co (NYSE:VRT) is a rare data center cooling stock on our list. If you read the intro to this piece, you’d understand why cooling might be one of the most underappreciated plays in the data center industry. Its shares are up a strong 54% year to date, helped by the fact that Vertiv Holdings Co (NYSE:VRT)’s second quarter saw it report a strong 57% growth in its organic sales. These sales are new additions to Vertiv Holdings Co (NYSE:VRT)’s customer base, and they indicate the firm’s ability to expand its market share. Another key standout point for the firm is its industry partnerships, with Vertiv Holdings Co (NYSE:VRT) having teamed up with firms like NVIDIA to develop custom cooling solutions. This means that NVIDIA and other firms’ customers can also pitch Vertiv Holdings Co (NYSE:VRT)’s products to their customers and provide the firm a key advantage in a highly evolving AI industry.

ClearBridge Investments mentioned Vertiv Holdings Co (NYSE:VRT) in its Q2 2024 investor letter. Here is what the firm said:

“In the second quarter, we added three new holdings in the sector: electrical product manufacturer Vertiv, building products supplier Builders FirstSource and environmental waste management provider Clean Harbors. The largest new addition of the three, Vertiv, has key offerings in power and thermal management designed to power, cool, deploy, secure and maintain electronics that process, store and transmit data. The company generates the majority of its revenue from the data center end market, which we believe should benefit from continued spending growth supported in part by the rise in power requirements of next- generation AI graphic processing units (GPUs). The company is nicely profitable today though we see room for further margin expansion ahead.”