Here's Why Shares in This Hidden Data Center and AI Stock Surged in September

Key Points

• This company is one of the best ways to get exposure to data center capital spending.

• Capital spending commitments typically result in increased orders for data center solution providers.

• 10 stocks we like better than Vertiv ›

Shares in data center infrastructure company and Nvidia partner Vertiv Holdings (NYSE: VRT) surged by 18.2% in September, according to data provided by S&P Global Market Intelligence. The move follows an excellent period of news flow on Vertiv's primary end market, specifically AI-driven data center spending.

Image source: Getty Images.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

Vertiv's and hyperscalers' roles in data centers

The company provides power, thermal management, and other critical data center infrastructure. The key metric that investors follow is its order flow, as orders typically flow into revenue and cash flow. However, the key to growing that metric is the willingness of hyperscalers (large-scale public cloud providers that include Alphabet's Google Cloud, Microsoft's Azure, Amazon Web Services, Oracle Cloud Infrastructure, and Meta's private cloud).

The data center spending plans of these companies are closely watched, not only because they indicate where the market is heading, but because, according to management consultant McKinsey, about 70% of demand from data centers "is for data centers equipped to host advanced-AI workloads" typically run by hyperscalers.

Positive news flow

As such, when hyperscalers make multi-billion dollar deals and capital spending commitments, investors start to pencil in a strengthening of orders at Vertiv down the line, not least as Vertiv is partnering with Nvidia to develop infrastructure for the next generation of 800V high voltage direct current (HVDC) data centers set to launch in 2027.

The news flow through the month was highly positive, with Nvidia ending August by announcing a 56% year-over-year increase in data center revenue in its second quarter 2026 earnings and a 5% sequential increase on its first quarter.

Meanwhile, OpenAI, Oracle, and SoftBank announced a $300 billion deal to invest in an additional five data centers (7 gigawatts of capacity) under OpenAI's AI Infrastructure program, Stargate. The investment brings investment in Stargate up to $400 billion, and according to OpenAI, puts it on a "clear path to securing the full $500 billion, 10-gigawatt commitment we announced in January by the end of 2025, ahead of schedule."

Additionally, U.S. technology companies, including Microsoft, have announced $42 billion worth of investment to build data centers in the U.K.

Is Vertiv stock a buy?

The market wasted no time in pricing in the positive news flow into Vertiv's share price. While it might be too early to expect a significant bump in orders for the company, what management has to say about its sales pipeline when it reports its third-quarter earnings in a few weeks will be fascinating -- something to look out for.

Should you invest $1,000 in Vertiv right now?

Before you buy stock in Vertiv, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Vertiv wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $631,456!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,147,755!*

Now, it’s worth noting Stock Advisor’s total average return is 1,064% — a market-crushing outperformance compared to 191% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of September 29, 2025

Lee Samaha has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon, Meta Platforms, Microsoft, Nvidia, and Oracle. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.