Vertiv Holdings Co
Vertiv Holdings Co Fundamental Analysis
Vertiv Holdings Co (VRT) shows moderate financial fundamentals with a PE ratio of 69.78, profit margin of 13.03%, and ROE of 40.26%. The company generates $10.2B in annual revenue with strong year-over-year growth of 16.74%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 73.1/100 based on profitability, valuation, growth, and balance sheet metrics. The B grade reflects solid fundamentals with room for improvement in valuation or growth.
Fundamental Health Score
We analyze VRT's fundamental strength across five key dimensions:
Efficiency Score
ExcellentVRT demonstrates superior asset utilization.
Valuation Score
WeakVRT trades at a premium to fair value.
Growth Score
ModerateVRT shows steady but slowing expansion.
Financial Health Score
ExcellentVRT maintains a strong and stable balance sheet.
Profitability Score
ModerateVRT maintains healthy but balanced margins.
Key Financial Metrics
Is VRT Expensive or Cheap?
P/E Ratio
VRT trades at 69.78 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, VRT's PEG of 2.42 indicates potential overvaluation.
Price to Book
The market values Vertiv Holdings Co at 23.60 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 42.35 times EBITDA. This signals the market has high growth expectations.
How Well Does VRT Make Money?
Net Profit Margin
For every $100 in sales, Vertiv Holdings Co keeps $13.03 as profit after all expenses.
Operating Margin
Core operations generate 18.18 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $40.26 in profit for every $100 of shareholder equity.
ROA
Vertiv Holdings Co generates $10.91 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Vertiv Holdings Co produces operating cash flow of $2.14B, showing steady but balanced cash generation.
Free Cash Flow
Vertiv Holdings Co generates strong free cash flow of $1.92B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $5.02 in free cash annually.
FCF Yield
VRT converts 2.05% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
69.78
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
2.42
vs 25 benchmark
P/B Ratio
Price to book value ratio
23.60
vs 25 benchmark
P/S Ratio
Price to sales ratio
9.09
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.86
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.55
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.40
vs 25 benchmark
ROA
Return on assets percentage
0.11
vs 25 benchmark
ROCE
Return on capital employed
0.24
vs 25 benchmark
How VRT Stacks Against Its Sector Peers
| Metric | VRT Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 69.78 | 26.49 | Worse (Expensive) |
| ROE | 40.26% | 1307.00% | Weak |
| Net Margin | 13.03% | -5131.00% (disorted) | Strong |
| Debt/Equity | 0.86 | 0.81 | Neutral |
| Current Ratio | 1.55 | 10.48 | Neutral |
| ROA | 10.91% | -1549792.00% (disorted) | Strong |
VRT outperforms its industry in 2 out of 6 key metrics, particularly excelling in Net Margin, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Vertiv Holdings Co's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
-43.20%
Industry Style: Cyclical, Value, Infrastructure
DecliningEPS CAGR
210.63%
Industry Style: Cyclical, Value, Infrastructure
High GrowthFCF CAGR
4162.90%
Industry Style: Cyclical, Value, Infrastructure
High Growth