Research Update: Vertiv Group Corp. Upgraded To 'BB+' On Strong Performance And Improved Competitive Position, Outlook Positive

Power and thermal management equipment and service provider Vertiv Group Corp. continues to generate strong EBITDA and free operating cash flow (FOCF) supported by the solid demand for its products, productivity gains, favorable price-cost dynamics, and improved operating leverage from higher volumes. S&P Global Ratings forecasts the increase in the company's EBITDA will reduce its S&P Global Ratings-adjusted leverage to about 2x in 2024 and to the mid-1x area in 2025, which compares with the low-2x area as of the end of 2023. We view Vertiv's maintenance of S&P Global Ratings-adjusted leverage of below 2x as providing it with a good cushion relative to our 3x downside threshold at the 'BB+' rating. Moreover, we believe the company has strengthened its

...- Power and thermal management equipment and service provider Vertiv Group Corp. continues to generate strong EBITDA and free operating cash flow (FOCF) supported by the solid demand for its products, productivity gains, favorable price-cost dynamics, and improved operating leverage from higher volumes. - S&P Global Ratings forecasts the increase in the company's EBITDA will reduce its S&P Global Ratings-adjusted leverage to about 2x in 2024 and to the mid-1x area in 2025, which compares with the low-2x area as of the end of 2023. We view Vertiv's maintenance of S&P Global Ratings-adjusted leverage of below 2x as providing it with a good cushion relative to our 3x downside threshold at the '##+' rating. Moreover, we believe the company has strengthened its competitive position and is benefitting from its greater scale and the actions it implemented to improve its profitability and supply chain resiliency. - Therefore, we raised our issuer credit rating on Vertiv to '##+' from '##' and our...

Research Update