tech
The veteran Fortune 500 CEO who turned an 80-year-old AC company into an AI darling
If asked to name the top-performing stocks powered by the AI boom, most investors would probably guess Nvidia (correct), maybe Meta (wrong) and a bunch of other hyperscalers (also wrong). You’d be hard pressed to find anyone who would answer Vertiv, an 80-year-old AC maker. But since Vertiv went public in early 2021, its market cap has exploded almost 10x from under $11 billion to $109 billion. Over that six-and-a-half year span, its annualized return of 50.5% stands third in the S&P 500, exceeded only by Comfort Systems (55.2%) and Nvidia (54.9%).
TL;DR
- Vertiv, an 80-year-old AC maker, has seen its market cap explode to $109 billion since going public in 2021, with a 50.5% annualized return.
- David Cote, former CEO of Honeywell, led Vertiv's transformation, spotting the company's potential in the burgeoning data industry.
- Vertiv's success is largely due to its development of direct-to-chip liquid cooling technology, crucial for preventing AI hardware like Nvidia GPUs from overheating.
- Cote implemented strategies similar to his Honeywell turnaround, focusing on R&D, strategic acquisitions (like CoolTera), and fostering a culture of continuous improvement.
- Vertiv is now a key player in the over $30 billion data center cooling market, battling rivals like Schneider Electric and Eaton, and is expected to reach $128 billion by 2033.