Vertiv Holdings Co (VRT) stock analysis

P/E below its 5-year median

Vertiv's P/E of 38.6 is below its own 5-year median of 68.9.

P/E above the industry

Vertiv's P/E of 38.6 is above the Electronic Components and Accessories median of 34.6.

EV/EBITDA below its 5-year median

Vertiv's EV/EBITDA of 25.8 is below its 5-year median of 35.6.

P/B above the industry

Vertiv's price-to-book of 14.45 is above the Electronic Components and Accessories median of 3.49.

Trading below fair value

The share price of $206.51 is below our fair value estimate of $234.92.

Margin of safety under 20%

The price is 12.1% below fair value, less than the 20% cushion we look for.

Revenue growing 10%+ a year

Revenue grew 21.6% a year over the last three fiscal years.

EPS growth over 3 years

Needs positive EPS three years ago and today.

Earnings acceleration

Needs positive net income now, a year ago and five years ago.

Growing faster than the industry

Revenue grew 35.3% over the last twelve months; the Electronic Components and Accessories median is 17.3%.

Guidance raised

Vertiv raised its Full Year 2026 Net sales outlook on Jul 29, 2026.

Gross margin improving

Gross margin was 38.1% over the last twelve months, against 35.7% a year earlier.

Return on equity over 15%

Return on equity was 46.6% over the last twelve months and averaged 21.7% over five years.

Return on capital over 10%

Return on invested capital was 42.8%, above the 10% that usually covers the cost of capital.

Return on equity above the industry

Vertiv's return on equity of 46.6% is above the Electronic Components and Accessories median of 4.8%.

Earnings over 5 years

Needs positive net income five years ago and in the latest year.

Net margin above its 5-year average

Net margin was 16.0% over the last twelve months, against a 5-year average of 5.9%.

Net margin above the industry

Vertiv's net margin of 16.0% is above the Electronic Components and Accessories median of 3.0%.

High debt

Debt is 53.2% of shareholders' equity, above the 40% we consider low.

Debt falling against equity

Debt to equity fell from 420% five years ago to 53.2%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 125% of total debt.

Interest well covered

Operating income covers interest expense 73.2 times.

Short-term assets cover short-term debts

Current assets are 1.39 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 5.39; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Vertiv paid dividends worth 0.1% of the share price over the last twelve months.

Yield below Treasuries

The 0.1% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Vertiv yields 0.1%.

Dividend stability

Fewer than five years of dividend history.

Covered by earnings

Dividends take 4.6% of net income.

Covered by free cash flow

Dividends take 3.0% of free cash flow.