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Investing.com - Wolfe Research has reiterated an Outperform rating and $155.00 price target on Vertiv Holdings Co. (NYSE:VRT), following the company’s recent acquisition announcement. With the stock currently trading at $131.43 and analyst targets ranging from $82 to $165, InvestingPro data shows the company maintains a "GREAT" overall financial health score of 3.22/5.
The research firm described the deal as "strategically cogent" with a "reasonable entry ROI" considering the growth outlook and potential revenue synergies, though specific acquisition details were not provided in the analysis.
Based on the imputed EBITDA of $17-18 million mentioned by Wolfe Research, the acquired company likely has a revenue base in the "$85-90m zone" with approximately 150 employees.
The acquisition partially addresses what Wolfe Research termed a "capital allocation conundrum" for Vertiv, which needs to deploy its growing balance sheet capacity estimated at around $10 billion through 2028.
Wolfe Research characterized this substantial capital deployment capacity as "a good problem" for Vertiv, suggesting the firm views the company’s strong financial position positively.
In other recent news, Vertiv Holdings Co. has announced an agreement to acquire Great Lakes Data Racks & Cabinets for $200 million. The acquisition, expected to close in the third quarter of 2025, aims to enhance Vertiv’s capabilities in delivering pre-engineered, AI-ready rack solutions. The purchase price represents approximately 11.5 times the expected 2026 earnings before interest, taxes, depreciation, and amortization, including cost synergies. Meanwhile, BofA Securities raised its price target on Vertiv to $150, maintaining a Buy rating, citing strong performance and a 13% year-over-year growth in orders in the first quarter of 2025. For the second quarter, BofA forecasts $2.7 billion in orders, with a projected 21% year-over-year organic revenue growth. Additionally, Melius Research upgraded Vertiv from Hold to Buy, increasing the price target to $165, driven by accelerating AI spending and reduced capital expenditure risks. Wolfe Research maintained its Outperform rating, noting that AWS’s adoption of proprietary designs is routine and highlights the demand for liquid cooling solutions. These developments reflect Vertiv’s strategic moves to strengthen its position in the critical digital infrastructure market.
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