Key Points
Vertiv has become a major player in the AI data center build-out by providing essential power and thermal management systems.
Vertiv’s $1.45 billion acquisition of Utility Innovation Holdings allows it to expand into microgrid solutions and upstream power architecture.
The company stands to benefit from ongoing investments in the data center build-out.
- 10 stocks we like better than Vertiv ›
The massive artificial intelligence (AI) data center build-out is one of the largest investment supercycles ever. According to JLL Research, global data center investment could reach $3 trillion by 2030. This massive infrastructure spending has created a slew of winners as hyperscalers look to secure everything from chips to power to thermal management solutions.
Vertiv (NYSE: VRT) has emerged as a primary beneficiary of this build-out. Traditional server racks use fans and perimeter air units to cool. But modern AI clusters, like those that use Nvidia Blackwell or GB200 systems, produce significantly more heat and require specialized cooling systems to keep them running.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a “Double Down” signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same “Total Conviction” signal is flashing for a company 1/100th the size of Nvidia. Continue »
Vertiv provides critical power and thermal management systems and has emerged as a top “pick-and-shovel” stock to play the AI build-out. The company is expanding beyond its traditional business, moving upstream to the utility-and-substation interface, and recently acquired Utility Innovation Holdings to build on that position.
Here’s why Vertiv’s recent acquisition is a big deal.
Vertiv expands into power architecture with its recent acquisition
On Sept. 2, Vertiv announced an agreement to acquire Utility Innovation Holdings (which operates as UtilityInnovation Group, or UIG) for $1.45 billion, plus an additional $1.15 billion contingent on specific milestones.
The acquisition gives Vertiv a company that provides microgrid solutions and behind-the-meter power architecture for data centers. It moves Vertiv’s business upstream into power architecture and should help operators lock in power faster as the grid faces severe constraints due to the growing presence of data centers.
Vertiv chief executive officer Gio Albertazzi told investors:
With UIG, we anticipate extending that portfolio upstream to the utility interconnect and onsite power sources, creating a coordinated architecture from source to chip without tying customers to a single generation technology or supplier.
The acquisition is priced at around 13 times UIG’s projected earnings before interest, taxes, depreciation, and amortization (EBITDA). If UIG meets those key milestones that trigger the additional payout, the multiple will actually be significantly lower. Vertiv expects this acquisition to boost earnings per share in the first year.
The move helps Vertiv build on incredibly strong demand from data centers
For years, Vertiv has dominated inside the server room. It provides companies with uninterruptible power supplies, switchgear, and intelligent power distribution units that help operators manage grid power fluctuations and prevent sudden power dropouts. Its infrastructure works regardless of whether a data center operator uses Nvidia GPUs, AMD GPUs, or cloud ASICs from Alphabet‘s Google or Amazon Web Services.
Image source: Getty Images.
The company has seen incredibly robust demand for its products as hyperscalers spend hundreds of billions of dollars in capital expenditures to build out data centers. In the second quarter, Vertiv’s sales topped $3.2 billion, while its adjusted free cash flow surged 234% year over year to $925 million. Management projects sales to reach $14 billion in 2026, with adjusted earnings per share expected to jump 60% to $6.70.
Now, Vertiv is moving beyond the server room and running toward grid and power solutions. This lets Vertiv package its components into a modular container, reducing friction that could cause delays as time-to-power becomes a crucial data center bottleneck. Vertiv doesn’t need to hand this off to competitors and can capture a larger slice of data center spend as a result.
Vertiv enjoys tailwinds from hyperscalers’ massive spending
Vertiv has emerged as a pick-and-shovel stock benefiting from hyperscalers’ massive capital expenditures. As a result, much of its demand is tied to these companies’ continued heavy spending on data centers. If hyperscalers begin to cut back on capital expenditures, Vertiv’s earnings could take a huge hit.
The risks are real, but so is Vertiv’s upside. Analysts covering the company project its earnings per share could grow at a 40% annual rate over the next three years. For investors bullish on the long-term data center build-out, Vertiv is a top stock to buy today.
Should you buy stock in Vertiv right now?
Before you buy stock in Vertiv, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Vertiv wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation, you’d have $410,024!* Or when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $1,372,815!*
Now, it’s worth noting Stock Advisor’s total average return is 950% — a market-crushing outperformance compared to 211% for the S&P 500. Don’t miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
*Stock Advisor returns as of September 11, 2026.
Courtney Carlsen has positions in Advanced Micro Devices, Alphabet, Nvidia, and Vertiv. The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Amazon, Nvidia, and Vertiv. The Motley Fool has a disclosure policy.
5 Stocks Our Experts Predict Could Double In the Next Year
By submitting your email, you'll also get a free pivot & flow membership. A free daily market overview. You can unsubscribe at any time.