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By Emily Bary

A Deutsche Bank analyst is upbeat about Vertiv’s stock and says the rush of new data-center deals suggests ‘the bull case may not even be bullish enough’

Vertiv makes cooling technologies that are vital to AI data centers.

Data-center technology provider Vertiv Holdings Co. has been a big winner as artificial intelligence has proliferated. But Deutsche Bank says investors who missed out on the stock’s 1,600%-plus rally over the past three years can still get in on future gains – though not quite at the same magnitude.

Admittedly, Vertiv’s stock (VRT) is expensive relative to recent historical levels, at least when you look simply at how it trades relative to forward earnings. Deutsche Bank’s Nicole DeBlase noted it trades at a ratio of 39x, versus its 32x one-year median.

But she thinks it’s better to look at the stock’s ratio of price to earnings to growth, where it screens in the bottom quartile among peer stocks in the multi-industry and electrical-equipment sector, meaning it’s relatively cheap from that perspective.

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She pointed to “a clear bifurcation in medium-term earnings growth algorithms between the secular growth ‘haves’ and ‘have nots’” and predicts that this split will “persist for the foreseeable future.” Therefore, she thinks it makes sense to look at Vertiv’s profile relative to peers, some of which are exposed to a more challenged macroeconomy.

Vertiv supplies electrical and mechanical equipment that goes into data centers, and DeBlase said it stands to benefit from perhaps $7 trillion in overall data-center infrastructure investments that could be made from 2025 to 2030, a number that comes from McKinsey estimates.

The company provides direct-to-chip liquid-cooling technologies, and that market could grow even more quickly that that for general electric equipment since the revenue base is negligible now. Previously, “traditional data centers did not broadly require liquid-cooling infrastructure,” DeBlase said. But AI is very power intensive and requires cooling systems to maximize efficiency.

DeBlase lifted her price target on the stock to $216 from $168, with the new target implying 20% upside. By applying more bullish assumptions, however, she could see the stock hitting $230, or 27% above current levels.

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But the growing hubbub around data-center investments now has DeBlase wondering: “Is the bull case bullish enough?” She noted big recent arrangements such as one between OpenAI and Broadcom Inc. (AVGO) and another between OpenAI and Advanced Micro Devices Inc. (AMD), and those are just a few of the newly announced deals.

“While it is impossible to know to what extent projects of this magnitude were already embedded in third-party data-center capacity forecasts, it does seem fair to say that if sizable project announcements continue, the bull case becomes increasingly likely – and the bull case may not even be bullish enough.”

More from MarketWatch: Why Broadcom’s OpenAI deal may not be all it’s cracked up to be

-Emily Bary

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Aptar today announced that it has been named a World’s Top Companies for Women 2025 by Forbes for the fifth consecutive year (formerly World’s Top Female Friendly Companies). Aptar is ranked 72 out of the 400 companies included on the list by Forbes and their partner Statista.

“Being recognized by Forbes for the fifth year in a row is a testament to the strides we’re making in advancing inclusion, equity and belonging across our global teams,” said Shiela Vinczeller, Aptar’s Chief Human Resources Officer. “When we honor and appreciate each person’s unique strengths, we build a workplace where everyone has the opportunity to achieve their full potential.”

“We are proud to be recognized as one of the World’s Top Companies for Women – a reflection of our meaningful progress to further a workplace where everyone is encouraged to participate in numerous events that promote inclusivity,” said Marcia Thomas, Chief Diversity Officer.

This award is presented on behalf of Forbes and Statista, a leading market research firm. Data for the “World’s Top Companies for Women” is based on an anonymous survey of over 120,000 women working in 36 countries. In this survey, participants are asked to evaluate companies based on three areas: employer brand, public opinion and leadership score. These surveys are conducted periodically over a two-year period.

For a full list of the World’s Top Companies for Women and a breakdown of the methodology, please visit the Forbes website here.