Data center infrastructure provider Vertiv surges on strong guidance

Vertiv (NYSE:VRT) shares surged as much as 21% in early Wednesday trading after the data center infrastructure provider gave a very strong full-year outlook.

The company reported Q2 EPS of $0.46 on revenue of $1.73 billion, easily beating the average analyst estimate for earnings of $0.29 on revenue of $1.62B. Vertiv also reported an adjusted operating margin of 14.5%, crushing the expected 12%.

“These strong results reflect our relentless focus on operational execution, the strength of the ongoing rebound in the Americas and our continued progress in building a high-performance culture of excellence,” said Giordano Albertazzi, Vertiv’s chief executive officer.

Following a Q2 outperformance, the company raised its full-year outlook. It now sees EPS of $1.59 on revenue of $6.8B, crushing the expectations for FY EPS of $1.26 on revenue of $6.55B.

“A key focus for us this year has been cash flow, and I am particularly encouraged by the trajectory of this critical metric. While far from our full potential, we are seeing the tangible results of our operational improvement initiatives,” Albertazzi added.

For this quarter, Vertiv sees net sales of $1.75B while consensus was looking for a $100 million lower figure.

Goldman Sachs analysts commented:

“We believe this is a strong report given the 2Q beat, solid orders, and increase to the full year revenue, EBIT, EPS, and FCF guidance.”