On Thursday, Oppenheimer sustained its positive stance on Vertiv Holdings Co. (NYSE:VRT), raising the firm's price target on the shares to $100.00 from $98.00. The adjustment comes after a review of the company's financial strategies and performance expectations.
The brokerage firm revised its interest expense predictions for the fiscal years 2024 and 2025, citing a $13 million annualized benefit from Vertiv's mid-June refinancing efforts. This move is expected to positively influence the company's financial health and projections.
In addition to the interest expense adjustments, Oppenheimer has updated its outlook on Vertiv's margin expansion and free cash flow. These revisions take into account the expected seasonal variations in sales, particularly a stronger leverage on sales in the fourth quarter of 2024.
The updated analysis also includes a reevaluation of the impact of foreign exchange (F/X) headwinds. Oppenheimer anticipates more favorable comparisons in the fourth quarter, leading to a slight redistribution of revenue from the third to the fourth quarter.
The new price target of $100 is based on a multiple of 22.4 times the firm's increased estimate for Vertiv's fiscal year 2025 EBITDA, which is now projected to be $1,768 million, up from the previous estimate of $1,762 million. This valuation adjustment reflects trends among Vertiv's industry peers.
In other recent news, Vertiv Holdings Co. demonstrated robust financial performance in the first quarter of 2024, with an 8% increase in sales and a significant surge in orders across all regions.
Vertiv's adjusted operating profit reached $249 million, and the company initiated a share repurchase program while raising its full-year guidance to predict a 12% organic growth and operating margins of 17.7%.
Evercore ISI raised its price target for Vertiv to $105, maintaining an Outperform rating and highlighting the company's end-to-end solutions as a key advantage.
Similarly, Citi kept a 'Buy' rating on Vertiv's stock, emphasizing the company's strong standing in thermal and power sectors, including liquid cooling technologies.
RBC Capital upheld an 'Outperform' rating for Vertiv, appreciating the successful introduction of the company's AI-driven business outcomes platform.
Oppenheimer increased its price target for Vertiv to $98, following the company's impressive first-quarter performance in 2024 that surpassed analysts' expectations. These are all recent developments in the company's progress.
InvestingPro Insights
Vertiv Holdings Co. (NYSE:VRT) has been the subject of keen interest after Oppenheimer's recent endorsement. Complementing the firm's analysis, InvestingPro provides additional real-time data and insights that could be vital for investors. Vertiv's market cap stands at a robust $35.23 billion, with a notable revenue growth of 15.27% over the last twelve months as of Q1 2024. This growth is paired with a high P/E ratio of 84.5, reflecting investor confidence in future earnings.
Two InvestingPro Tips highlight the investment potential in Vertiv: the company is expected to see net income growth this year and is trading at a low P/E ratio relative to near-term earnings growth. These factors, along with a high return of 272.22% over the past year, suggest a positive outlook for Vertiv's stock performance. Additionally, Vertiv's recent price uptick of 88.24% over the last six months aligns with Oppenheimer's raised price target.
For investors seeking a deeper dive into Vertiv's financials and future prospects, InvestingPro offers a comprehensive suite of tools and tips. There are a total of 15 additional InvestingPro Tips available for Vertiv, which can be accessed by investors looking to make an informed decision. Remember to use coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, and unlock the full potential of your investment research.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.