30 Best and Worst Data Center Stocks

5. Vertiv Holdings Co (NYSE:VRT)

Upside Potential: 42%

Number of hedge funds: 91

Next on the list is Vertiv Holdings Co (NYSE:VRT), a standout performer in 2024 with its stock price tripling since the start of January. The reason for this impressive growth is the company’s strong positioning in the expanding data center and critical infrastructure market. Vertiv offers a wide range of products, including critical power systems, thermal management (mainly cooling) products, racks and enclosures, and other IT infrastructure solutions and services.

Vertiv Holdings Co (NYSE:VRT) is the global leader in data center thermal management and power switching and distribution. The company derives 80% of its total revenues from the Data Center segment, with thermal and power management products accounting for 64% of total revenue. In their Q3 2024 earnings results, Vertiv’s CEO highlighted the company’s strength in meeting underlying demand and its unique market positioning:

“We are very encouraged by the acceleration of liquid cooling revenue, which is a visible contributor to our third quarter results, despite an immature market. Pipelines continue to grow. There are clear indications of an acceleration in AI development that is truly encouraging, and which is driving demand across our entire AI-enabling portfolio of power, thermal, IT systems, infrastructure solutions and services.”

We believe Vertiv Holdings Co (NYSE:VRT) has an impressive growth plan for the next decade, which should help it maintain its leadership position. In their last investor presentation, they projected revenue to reach $14.4 billion in 2029, up from around $7.8 billion in 2024, reflecting a solid CAGR of 12%-14%. Additionally, they expect margins to expand to approximately 25% from 19%, leading to strong free cash flows.