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Investing.com - Vertiv Holdings Co. (NYSE:VRT), a $45.9 billion market cap data center infrastructure company, saw its shares fall approximately 6% on Thursday following news that Amazon (NASDAQ:AMZN) Web Services (AWS) is adopting proprietary designs for its NVIDIA (NASDAQ:NVDA) Blackwell-enabled service offerings. According to InvestingPro data, the stock has shown significant volatility while maintaining strong financial health with a "GREAT" overall rating.
The CNBC report triggered concerns about potential disintermediation for data center infrastructure providers, with Nvent Electric (NYSE:NVT) also declining 2-3% on the news. Both companies have positioned liquid cooling solutions as key growth drivers. Despite market concerns, Vertiv has demonstrated robust performance with 20.45% revenue growth in the last twelve months.
Wolfe Research maintained its Outperform rating and $155 price target on Vertiv, noting that hyperscalers adopting proprietary designs for bespoke server requirements is "not a new development" but "quite routine." With analyst targets ranging from $82 to $165, investors seeking deeper insights can access comprehensive valuation analysis and 16 additional ProTips through InvestingPro’s detailed research reports.
The research firm highlighted that AWS appears to have selected a standard Liquid to Air (L2A) system, which is common technology for existing rack retrofits. Wolfe expressed skepticism that AWS would manufacture its own equipment, citing price disadvantages and supply chain complexities.
Wolfe Research suggested the AWS announcement could actually be viewed positively as it confirms hyperscalers are "going all in on liquid cooling" and retrofitting existing infrastructure to accelerate time to market. Vertiv currently trades at approximately 25 times estimated 2026 earnings.
In other recent news, Vertiv Holdings Co. announced a new reference architecture for cooling and power solutions, aimed at supporting the NVIDIA GB300 NVL72 platform. This new design is part of Vertiv’s 360AI infrastructure platform and promises significant enhancements in energy efficiency and space utilization. Additionally, Vertiv has appointed Mike Giresi as the new global Chief Information Officer, effective June 30, 2025, to lead initiatives in AI adoption and cybersecurity. Meanwhile, the company’s Chief Financial Officer, David Fallon, is set to retire, with a transition expected in the latter half of 2025. Vertiv has reaffirmed its financial guidance for the second quarter and full year of 2025, maintaining a positive outlook despite Fallon’s retirement.
Melius Research recently upgraded Vertiv’s stock from Hold to Buy, citing accelerated AI spending and reduced capital expenditure risks. Similarly, Citi raised its price target for Vertiv to $130, emphasizing the company’s strong positioning in the data center market. Citi expects Vertiv to benefit significantly from the growth in AI and data center expansion, projecting a 14% compound annual growth rate in global data center IT load through 2030. These developments highlight Vertiv’s ongoing efforts to strengthen its market position and operational capabilities.
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