VRT

Vertiv is a genuinely best-in-class business riding the AI/data-center power-and-cooling buildout, and the fundamentals are accelerating, not just growing. Revenue has doubled from $5.0B (FY2021) to $10.2B (FY2025) and is still speeding up (+27.7% YoY), while net income jumped +168.8% to $1.33B and diluted EPS rose +166.4% to $3.41 on a roughly flat share count. Margins are expanding (operating margin 17.9%), returns are excellent (ROE 33.8%), and the model is capital-light: operating cash flow of $2.11B (+60.2%) against just $220M of capex implies ~$1.9B of free cash flow. The balance sheet is sound — $1.73B cash against $2.89B long-term debt (net debt ~$1.2B, covered by a single year of OCF); the 2.10x liabilities/equity is dominated by operating liabilities and customer deferrals, not financial leverage.

The forward visibility is the standout. The 10-K reports combined order backlog roughly doubled to $15.0B from $7.2B a year earlier — about 1.5x annual revenue — with the majority considered firm and expected to ship within 12–18 months, directly tied to AI and high-performance-computing power and thermal demand. Management backs this with capacity: switchgear/busbar/integrated-power capacity more than doubled since 2021, a new Pune thermal plant, the Pelzer, SC modular facility, and the ~$200M Great Lakes rack/cabinet acquisition. This is a company executing into a real, secular demand wave.