VRT vs. TEL: Which AI Infrastructure Stock is a Stronger Play Now?

Vertiv Holdings VRT and TE Connectivity TEL are key players in the AI infrastructure domain, providing essential components and solutions for data centers. Vertiv specializes in power and thermal management systems, crucial for maintaining optimal conditions in AI-driven data centers. TE Connectivity offers high-speed connectors and sensors that facilitate efficient data transmission and system reliability. Per IDC estimates, AI infrastructure is poised to surpass $200 billion in spending by 2028, offering a solid opportunity for both stocks.So, VRT or TEL — Which of these AI Infrastructure stocks has the greater upside potential? Let’s find out.The Case for VRTVertiv’s extensive product portfolio, which spans thermal systems, liquid cooling, UPS, switchgear, busbar and modular solutions, is noteworthy. In the trailing 12 months, organic orders grew approximately 20%, with a book-to-bill of 1.4 times for the first quarter of 2025, indicating a strong prospect. Backlog grew 10% sequentially and 25% year over year to $7.9 billion.The company expanded its portfolio with the introduction of the Vertiv CoolLoop Trim Cooler, enhancing air and liquid cooling solutions for AI and High-Performance Computing applications. The system offers up to 70% energy savings, 40% space reduction, and seamless integration for high-density cooling environments.Vertiv launched four new systems designed to meet the growing demands of AI applications. The four new systems include Vertiv Unify software for infrastructure management, SmartRun modular prefabricated solutions, CoolLoop RDHx high-density heat exchangers, and PowerDirect Rack high-density DC power shelves, all designed to enhance power efficiency, thermal management, and scalability in AI-driven data centers.The company’s rich partner base, which includes Maxom, Ballard Power Systems, Compass Datacenters, NVIDIA, Intel, ZincFive, and Tecogen, is a key catalyst.The Case for TELTE Connectivity is benefiting from secular growth trends in key markets and increasing demand for connectivity solutions, especially in AI, automotive electrification, and industrial automation.The company saw orders grow to $4.25 billion, 6% both sequentially and year over year, in the second quarter of fiscal 2025, driven by strong growth in its Industrial segment. This includes increased momentum in AI applications and strong demand in aerospace, defense, and energy sectors.TEL’s strong momentum in AI applications, particularly in digital data networks, has been noteworthy. Its design wins in hyperscale AI platforms have set the company up for substantial revenue growth, which is expected to exceed $700 million in fiscal 2025. This reflects the increasing adoption of AI technologies across various industries.TEL has positioned itself as a leader in AI infrastructure, especially in the digital data networks space. The company experienced nearly 80% organic growth in its digital data networks business in the second quarter of fiscal 2025, driven by increasing ramps from hyperscale AI platforms.Price Performance and Valuation of VRT and TELYear to date, Vertiv’s shares have lost 7.1%, whereas TE Connectivity’s shares have gained 13.6%. Vertiv’s share price has declined due to increasing macroeconomic challenges and U.S. President Donald Trump’s decision to impose tariffs on top trading partners, including China, Mexico and Canada, which has increased the chances of a trade war.TE Connectivity’s outperformance can be attributed to strong growth in the Industrial Solutions segment, driven by robust demand for artificial intelligence applications.VRT and TEL Stocks PerformanceImage Source: Zacks Investment ResearchValuation-wise, Vertiv shares are currently overvalued as suggested by a Value Score of D, whereas TE Connectivity’s shares are cheap, as indicated by a Value Score of B.In terms of forward 12-month Price/Sales, Vertiv shares are trading at 4.02X, higher than TEL’s 2.80X.VRT and TEL ValuationImage Source: Zacks Investment ResearchHow Do Earnings Estimates Compare for VRT & TEL?The Zacks Consensus Estimate for Vertiv’s 2025 earnings is pegged at $3.55 per share, which has increased 2.6% over the past 30 days, indicating a 24.56% increase year over year.Vertiv Holdings Co. Price and Consensus Vertiv Holdings Co. price-consensus-chart | Vertiv Holdings Co. QuoteThe Zacks Consensus Estimate for TE Connectivity 2025 earnings is pegged at $8.19 per share, which has increased 1.7% over the past 30 days, indicating an 8.33% increase year over year.TE Connectivity Ltd. Price and Consensus TE Connectivity Ltd. price-consensus-chart | TE Connectivity Ltd. QuoteConclusionTE Connectivity is the stronger investment option compared to Vertiv, thanks to its robust growth in AI applications, solid earnings estimates, and attractive valuation. Vertiv’s higher valuation and recent stock decline make it a less compelling choice at this time.Currently, TE Connectivity has a Zacks Rank #2 (Buy), making the stock a stronger pick compared to Vertiv, which has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report TE Connectivity Ltd. (TEL): Free Stock Analysis Report Vertiv Holdings Co. (VRT): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks