Prediction: This Underrated AI Infrastructure Stock Will Continue Soaring Despite Doubling in a Year

Key Points

• Vertiv sells critical equipment for AI data centers, which is why it has a solid order book that's driving impressive growth in revenue and earnings.
• Vertiv stock has pulled back lately, opening a buying opportunity for savvy investors.
• Vertiv stock can continue to soar even after its impressive gains over the past year, indicating that it isn't too late for investors to buy.
• 10 stocks we like better than Vertiv ›

Vertiv Holdings (NYSE:VRT) may not be a household name in the artificial intelligence (AI) infrastructure ecosystem. However, the company's shares have jumped by an impressive 109% over the past year.

Vertiv is a key player in the AI infrastructure space, as it builds, sells, and services critical equipment for power and thermal management that ensures the smooth operation of data centers. However, the recent stock price action suggests investors have been booking profits in this AI stock.

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Shares of Vertiv have pulled back 30% from the 52-week high seen in mid-May. The slide in Vertiv stock suggests that investors may be losing confidence in the company's ability to deliver more upside. However, selling Vertiv stock doesn't seem like a smart move. After all, the company remains well-positioned to capitalize on booming AI data center investments thanks to the key components it sells.

We will take a closer look at Vertiv's prospects in this article and check why this underrated stock can regain its mojo and soar once again.

Image source: The Motley Fool.

Vertiv operates in a fast-growing market

The demand for Vertiv's thermal management, power management, and server racks is poised to grow at a solid pace. For instance, sales of liquid-cooling systems in data centers are projected to increase at an annual rate of 26% through 2033, according to Persistence Market Research.

On the other hand, Goldman Sachs predicts that data center power demand could increase by 170% between 2025 and 2030. This rapid growth in data center power demand should be a tailwind for Vertiv's power solutions, such as uninterruptible power supplies (UPS), battery storage, and power distribution systems.

The good news for Vertiv investors is that the strong demand in these end markets is fueling solid growth for the company. It reported a 24% year-over-year increase in revenue in the second quarter to $3.27 billion. Even better, the company's adjusted earnings increased by 60% year over year to $1.52 per share. Importantly, Vertiv's adjusted free cash flow shot up by 234% year over year to $925 million in Q2.

The healthy growth prospects of Vertiv's end markets explain why the company expects $14 billion in revenue in 2026, a 37% improvement over last year. The company also expects adjusted earnings per share to jump by 60% at the mid-point in 2026 to $6.70. It is worth noting that Vertiv was originally expecting $13.5 billion in revenue and a 43% increase in adjusted earnings per share at the beginning of the year.

However, a strong order book and investments in data center infrastructure have encouraged the company to raise guidance. Vertiv pointed out in February that it was receiving nearly three times as many orders as it was fulfilling, as evidenced by a book-to-bill ratio of 2.9 in the fourth quarter of 2025. Also, it had a $15 billion order backlog at the end of 2025.

So, it won't be surprising to see Vertiv's growth rate improve in the future. Analysts have raised their revenue growth expectations for Vertiv over the next couple of years, though I won't be surprised if it exceeds expectations.

VRT Revenue Estimates for Current Fiscal Year data by YCharts

Strong earnings growth suggests more upside

We have already seen that Vertiv anticipates a 60% spike in earnings this year. Moreover, analysts anticipate healthy double-digit earnings growth over the next couple of years.

VRT EPS Estimates for Current Fiscal Year data by YCharts

However, there has been an upward revision in Vertiv's long-term earnings per share (EPS) growth estimates, suggesting it can outperform expectations.

VRT EPS LT Growth Estimates data by YCharts

But even if Vertiv's EPS increases in line with consensus expectations and reaches $11.60 in 2028, its stock price could jump to $394 (assuming it trades in line with the tech-focused Nasdaq-100 index's average earnings multiple of 34). That's a potential gain of 50%. However, this tech stock could deliver bigger gains given its ability to post stronger earnings growth.

So, investors looking to capitalize on the fast-growing AI infrastructure market can take a closer look at Vertiv and consider buying it before it soars higher on its robust growth.

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Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Goldman Sachs Group and Vertiv. The Motley Fool has a disclosure policy.