NVent Electric's (NVT) in-line Q4 results and 2026 outlook show that its datacenter growth narrative is "fully on track," RBC Capital Markets said in a note emailed Monday.

The company's revenue outlook is set conservatively at the beginning of year for "beat-and-raise' setup," the the note said.

RBC said investors' excitement was tempered by "softer margins" due to transitory costs linked to capacity ramps, but the investment firm believes nVent is "prudently making the necessary self-funded growth investments for capacity expansion to convert $2.3 [billion] backlog, up 3x from a year ago."

Also, nVent's "bull case" is evident in the quarter with factors like accelerating 23.6% organic revenue, backed by datacenter and utilities, and 30% growth in organic orders, RBC said.

The company has an upcoming catalyst with its Feb. 24 investor day in New York, where its medium-term targets are expected to be updated, the investment firm said.

RBC lifted nVent's price target to $138 from $136, and has an outperform rating on the company.

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