Roth launches coverage of nVent Electric with a “Buy” rating

Roth Capital Markets has initiated coverage of nVent Electric (nVent Electric Stock Quote, Chart, News, Analysts, Financials NYSE:NVT) with a “Buy” rating and a 12-month price target of $89, saying the company offers a compelling opportunity due to its increased exposure to high-growth markets, trusted brands, and margin expansion potential.

nVent Electric is a global electrical systems company with over $3-billion in annual revenue and more than 10,000 employees. Headquartered in London with major U.S. operations in Minneapolis, the company traces its roots back over a century. It provides connection and protection solutions through well-known brands such as Caddy, Erico, Hoffman, Schroff, Ilsco, and Trachte, serving industries including data centers, utilities, and infrastructure.

“NVT is a top-tier player in electrical connection and protection with advantages in electrical enclosures, connectors, and liquid cooling,” Roth analyst Justin Clare wrote in a July 22 report.

He said the company’s strategic transformation over the past several years has significantly increased its exposure to faster-growing segments, particularly infrastructure markets tied to long-term investment themes.

“NVT has strategically reshaped its portfolio to capitalize on high-growth opportunities, shifting its mix toward the Infrastructure vertical, which is projected to account for over 40% of 2025 estimated sales, up from just 12% in 2017,” Clare said. “This transformation aligns NVT with powerful secular megatrends: electrification, sustainability, and digitalization.”

Clare also sees a path to stronger profitability. Roth expects adjusted operating margins to improve over the next two years as higher-margin businesses represent a growing share of the overall mix.

“We forecast adjusted operating margins to rebound to 21% in 2026 with further upside into 2027 and beyond,” Clare wrote.

In addition, Clare pointed to the company’s strong free cash flow profile, which supports both reinvestment and capital return.

“NVT delivered net income to free cash flow conversion of 91% in 2023, 102% in 2024, and provided guidance of 95-100% in 2025,” he said.

Clare thinks that nVent will generate $729.7-million in EBIT on $3,609.3-million in revenue in fiscal 2025. He expects those figures to improve to $826.9-million in EBIT on $3,949.8-million in revenue in fiscal 2026.

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