Vertiv shares fall on analyst downgrades and options bets

Vertiv Holdings Co. shares dropped 6.7% in morning trading Thursday following two analyst price target cuts and increased bearish options activity.

RBC Capital reduced its price target on Vertiv to $323 from $337 on October 14, maintaining an Outperform rating. Mizuho followed on Thursday by lowering its target to $280 from $300, also keeping an Outperform rating. Mizuho cited model adjustments across the electrical equipment sector ahead of the upcoming earnings season.

Put option volume on Vertiv surged to approximately seven times normal levels, with the most active contracts being October-expiry $195 puts.

Analysts also compared Vertiv unfavorably to peer Amphenol, noting that Amphenol has delivered stronger stock performance and maintains a more diversified portfolio. This comparison appears to be driving some investors to shift away from Vertiv shares.

A company director's share sale under a pre-arranged trading plan added additional selling pressure.

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