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Vertiv (VRT) Rallied in Q1 Over Multiple Reasons

ClearBridge Investments, an investment management company, released its “ClearBridge SMID Cap Growth Strategy” first quarter 2024 investor letter. A copy of the letter can be downloaded here. Strong corporate earnings, enthusiasm over AI, and anticipation of interest rate cuts boosted the equity market rally in the first quarter. The growth stocks outperformed their value counterparts during the quarter as benchmark Russell 2500 Growth Index returning 8.51% versus the 6.07% return of the Russell 2500 Value Index. Against this backdrop, the strategy underperformed its Russell 2500 Growth Index benchmark in the quarter. Industrials and healthcare sectors were the leading contributors while the real estate and IT sectors detracted. In addition, please check the fund’s top five holdings to know its best picks in 2024.

ClearBridge SMID Cap Growth Strategy highlighted stocks like Vertiv Holdings Co (NYSE:VRT), in the first quarter 2024 investor letter. Vertiv Holdings Co (NYSE:VRT) designs, manufactures, and services critical digital infrastructure technologies and life cycle services for data centers, communication networks, and commercial and industrial environments. The one-month return of Vertiv Holdings Co (NYSE:VRT) was -15.23%, and its shares gained 274.54% of their value over the last 52 weeks. On June 24, 2024, Vertiv Holdings Co (NYSE:VRT) stock closed at 89.14 per share with a market capitalization of $33.369 billion.

ClearBridge SMID Cap Growth Strategy stated the following regarding Vertiv Holdings Co (NYSE:VRT) in its first quarter 2024 investor letter:

“Stock selection in the industrials sector was also a positive contributor to performance, led by Vertiv Holdings Co (NYSE:VRT) and XPO. Vertiv, a global manufacturer of power, precision cooling and infrastructure management systems for mainframe computer, server racks and critical process systems, rallied on continued demand for AI-related companies and beneficiaries and anticipation of greater demand for data center systems.”

A close-up of a group of technicians working on complex data center systems.

Vertiv Holdings Co (NYSE:VRT) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 85 hedge fund portfolios held Vertiv Holdings Co (NYSE:VRT) at the end of the first quarter which was 75 in the previous quarter. Vertiv Holdings Co (NYSE:VRT) had a strong start in 2024 with an 8% increase in first quarter sales. While we acknowledge the potential of Vertiv Holdings Co (NYSE:VRT) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

We discussed Vertiv Holdings Co (NYSE:VRT) in another article and shared the list of best AI stocks that can benefit from a new $1.2 trillion opportunity highlighted by UBS in a latest report. Vertiv Holdings Co (NYSE:VRT) contributed to the performance of Alger Mid Cap Growth Fund in Q1 2024. In addition, please check out our hedge fund investor letters Q1 2024 page for more investor letters from hedge funds and other leading investors.

READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks.

Disclosure: None. This article is originally published at Insider Monkey.

The $250 Trillion AI Hype is Real. A few years from now, you’ll probably wish you’d bought this stock.

When Jeff Bezos said that one breakthrough technology would shape Amazon’s destiny, even Wall Street’s biggest analysts were caught off guard.

Fast forward a year and Amazon’s new CEO Andy Jassy described generative AI as a “once-in-a-lifetime” technology that is already being used across Amazon to reinvent customer experiences.

At the 8th Future Investment Initiative conference, Elon Musk predicted that by 2040 there would be at least 10 billion humanoid robots, with each priced between $20,000 and $25,000.

Do the math. According to Musk, this technology could be worth $250 trillion by 2040.

Put another way, that’s roughly equal to:

  • 175 Teslas
  • 107 Amazons
  • 140 Metas
  • 84 Googles
  • 65 Microsofts
  • And 55 Nvidias

And here’s the wild part — this $250 trillion wave isn’t tied to one company, but to an entire ecosystem of AI innovators set to reshape the global economy.

It’s a leap so massive, it could reshape how businesses, governments, and consumers operate worldwide.

Even if that $250 trillion figure sounds ambitious, major firms like PwC and McKinsey still see AI unlocking multi-trillion-dollar potential.

How could anything be worth that much?

The answer lies in a breakthrough so powerful it’s redefining how humanity works, learns, and creates.

And this breakthrough has already set off a frenzy among hedge funds and Wall Street’s top investors.

What most investors don’t realize is that one under-owned company holds the key to this $250 trillion revolution.

In fact, Verge argues this company’s supercheap AI technology should concern rivals.

Before I reveal the details, let’s talk about how some of the richest people on the planet are positioning themselves.

  • Bill Gates sees artificial intelligence as the “biggest technological advance in my lifetime,” more transformative than the internet or personal computer, capable of improving healthcare, education, and addressing climate change.
  • Larry Ellison — through Oracle, is spending billions on Nvidia chips and partnering with Cohere to embed generative AI across Oracle’s cloud and apps.
  • Warren Buffett — not known for tech hype — says this breakthrough could have a ‘hugely beneficial social impact.

When billionaires from Silicon Valley to Wall Street line up behind the same idea — you know it’s worth paying attention to.

Even as we admire what Tesla, Nvidia, Alphabet, and Microsoft have built, we believe an even greater opportunity lies elsewhere…

But the real story isn’t Nvidia — it’s a much smaller company quietly improving the critical technology that makes this entire revolution possible.

And judging by what I’m hearing from both Silicon Valley insiders and Wall Street veterans…

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