Vertiv's (VRT) long-term growth story continues as it posted a "high-quality" Q1 earnings beat and raised guidance, RBC Capital Markets said in a Wednesday note.

AI infrastructure demand from hyperscalers, colocation data centers, and new cloud players continue to fuel Vertiv's growth, as shown with US sales up 44% organically and a growing project pipeline, RBC analysts said.

Even amid tariffs and headwinds related to capacity growth, the company surprisingly lifted its full-year earnings before interest and taxes margin guidance, the analysts said. They said they appreciated Vertiv's pricing power, driven by strong demand and pre-built integrated data center white space and construction services.

The analysts believe that the company has the ample flexibility to invest in capacity expansions, new products such as 800V technology, and bolt-on acquisitions.

RBC increased its 2026 EPS estimates for Vertiv to $6.40 from $6.15, and 2027 EPS estimates to $8.60 from $8.30.

RBC reiterated the company's stock rating at outperform and raised the price target to $356 from $344.

Price: 321.99, Change: +16.85, Percent Change: +5.52