Key Takeaways
- Vertiv (VRT) fell 23% in the month through October 22 before rebounding 16% on October 28 as strong third-quarter earnings helped restore investor confidence.
- Bloom Energy (BE) and other AI infrastructure stocks faced pressure as financing concerns surrounding Meta Platforms (META) and CoreWeave (CRWV) weighed on sentiment.
- Vertiv’s partnership with Nvidia (NVDA) strengthens its position in AI infrastructure, while management raised its 2026 revenue and earnings guidance.
- Vertiv appears fairly valued with upside potential following its rebound, making holding or selectively buying more attractive than selling or aggressively loading up.
What Happened?
Vertiv (VRT) stock dropped 23% in the month through October 22 as concerns about financing the AI infrastructure boom weighed on investor sentiment. However, shares rebounded 16% on October 28 after the company reported strong third-quarter earnings and raised its full-year outlook.
Shares closed at $233 on October 30, gaining nearly 20% over the past week as investors responded to accelerating demand for the company’s power and cooling equipment.
Meta Platforms (META) reported $34.9 billion in third-quarter capital expenditures, exceeding its $32.79 billion in operating cash flow and producing negative free cash flow of $2.12 billion.
Meanwhile, CoreWeave (CRWV) faced concerns about borrowing costs, adding pressure to AI infrastructure stocks. Bloom Energy (BE) declined 21% during the month through October 22, compared with a 1% drop in the S&P 500.
The selloff also affected other AI infrastructure companies, with Bloom Energy declining 21% during the month through October 22, compared with a 1% drop in the S&P 500.
However, Vertiv’s latest earnings showed that customer demand remained exceptionally strong.
Third-quarter revenue increased 61% year over year to $4.31 billion, including 55% organic growth. Adjusted operating profit jumped 83% to $1.09 billion, while adjusted earnings per share rose 78% to $2.21.
Organic orders more than doubled year over year, suggesting customers continued investing heavily in data center infrastructure despite financing concerns.
CEO Giordano Albertazzi said, “We are in the middle of the largest infrastructure buildout and it’s accelerating.”
Management also raised its 2026 sales outlook to between $14.45 billion and $14.85 billion, alongside adjusted EPS guidance of $7.10 to $7.20.
Vertiv received another positive development on October 21 when Nvidia (NVDA) introduced an AI factory infrastructure approach with Vertiv using Nvidia DSX.
Under modeled assumptions, the approach could generate up to 30% more cumulative AI token output during the first 12 months by accelerating infrastructure deployment.
The partnership strengthens Vertiv’s position in supplying power and thermal management systems for increasingly demanding AI workloads.
Is Vertiv Stock Undervalued or Overvalued?
Before its October 28 earnings report, Vertiv traded at approximately 25x forward earnings, below its five-year average of 27x and significantly below its May peak of 55x. The lower valuation reflected investors’ concerns about AI infrastructure spending before the company’s strong earnings rebound.
Management’s updated 2026 adjusted EPS guidance of $7.10 to $7.20 strengthens Vertiv’s earnings outlook. Before the latest results, analysts expected normalized EPS to grow from $4.20 in 2025 to $9.19 in 2027, although those estimates may change following the stronger earnings report.
TIKR’s analyst consensus price target stood at approximately $333 before Vertiv’s latest earnings report, implying about 43% upside from its October 30 closing price of $233. However, this historical target does not account for any subsequent analyst revisions following the company’s stronger earnings results.
Strong orders, expanding profitability, and Nvidia-related infrastructure opportunities could support further earnings growth over the next 12 months. However, tighter financing conditions, weaker AI spending, and slower order growth remain important risks.
Vertiv appears fairly valued with upside potential following its earnings-driven rebound. Strong demand and higher guidance support holding existing shares rather than selling. However, after the recovery to $233, waiting for a more attractive entry point makes more sense than aggressively loading up at current prices.
So what is Vertiv stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
