Key Takeaways
- Vertiv fell 12.9% on Wednesday and 11.7% on Thursday after Democrats won Congress, a result that revived worries about data center buildouts.
- The slide came a week after third-quarter sales rose 61% to $4.31 billion, beating consensus by about $550 million.
- Vertiv has stopped disclosing orders, so investors lose their best demand signal just as political risk rises.
- An investor conference on November 10 and the February 10 report, with first 2027 guidance, are the next reads on demand.
Vertiv (VRT) delivered one of the cleanest beats of earnings season a week ago. Since the midterms, it has lost 23%.
The trigger was political. Democrats won Congress in Tuesday’s vote, and that revived fears that data center projects will face more resistance. Vertiv fell 12.9% on Wednesday, then 11.7% on Thursday as the Dow dropped 1,800 points. Shares closed at $182, down roughly 40% over six months and 52% below their 52-week high of $380.
Vertiv had company. Dell Technologies (DELL) fell 14.9% on Thursday as investors sold the AI hardware chain broadly. Dell trades near 12x forward earnings, while Vertiv still sits around 21x, and that premium leaves Vertiv more exposed if sentiment keeps souring.
The quarter that got erased
Vertiv’s third quarter, reported October 28, cleared every bar:
- Net sales rose 61% to $4.31 billion, against a $3.76 billion consensus.
- Adjusted EPS of $2.21 beat the $1.82 estimate and grew 78%.
- Organic orders more than doubled from a year earlier.
Management then raised full-year guidance to $14.65 billion of sales and $7.15 of adjusted EPS. Fourth-quarter guidance calls for about $4.41 billion of sales and $2.25 of adjusted EPS.
The quarterly sales line shows how quickly the step-up arrived:
Third-quarter sales ran about a third above the second quarter’s $3.27 billion, a jump the market celebrated for barely a week.
Supply sets the pace
Backlog generally covers deliveries 12 to 18 months out. The bottlenecks are power availability, permitting, and skilled construction labor.
Vertiv is spending to keep up. It plans to double chiller capacity by year-end, closed the UtilityInnovation Group and King Environmental Services deals in October, and signed a three-year chip supply agreement with Infineon on Wednesday. It also teamed with Nvidia on systems designed to cut AI factory deployment time by up to half.
Has all that spending squeezed profitability?
Trailing operating margin stands at 21.1%, and the balance sheet carries $355 million of net cash, so Vertiv is funding growth from strength.
TIKR tracks 30 analysts on Vertiv. How many say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on Vertiv, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See Vertiv’s Analyst Ratings
Less visibility, same premium
The harder issue is disclosure. Vertiv will no longer report orders, which doubled last quarter and were the best evidence for the bull case. Investors now have to wait for sales and guidance.
What the election actually changes is still unclear. Permitting and grid hookups are mostly state and local decisions, so a new Congress may matter less than this week’s drop suggests.
Even after the slide, the premium to Dell is wide…
At about 21.4x, Vertiv trades at roughly 1.8 times Dell’s multiple. Wall Street’s average target of $339 sits 87% above Thursday’s close.
My take: I’d treat the two-day drop mostly as a sentiment hit. Guidance implies roughly 70% EPS growth this year, and 21x for that looks cheap to me. Still, I’d want management to address the political risk directly before adding, because the orders data that used to settle these debates is gone.
That chance comes soon. Vertiv speaks at Baird’s Global Industrial Conference on November 10, its first public read since the election. The February 10 report then brings first 2027 guidance.
So what is Vertiv stock actually worth?
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Disclaimer:
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