US Electrical Equipment & Multi-Industry "Opportunities & risks after th..."

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US Electrical Equipment & Multi-Industry "Opportunities & risks after th..."

Global Research

12 May 2026ab

US Electrical Equipment & Multi-Industry Equities

AmericasOpportunities & risks after the surge higher

Industrial, Diversified

Amit Mehrotra

We remain positive on industrial equities, but the recent surge warrants a closer look at Analyst

both opportunities for further outperformance as well as risks for correction. This note amit.mehrotra@ubs.com

offers our thoughts on both. +1-201-352 1410

Neal Burk

Multi-Industry stocks are up 16% this year vs. +11% for the XLI and +9% for the S&P Analyst

500. But the performance is dominated by industrial AI companies like VRT (+120%), neal.burk@ubs.com

MOD (+100%), NVT (+65%) and GEV (+60%). When adjusting for outliers, the +1-212-713 4066

median performance has been +9%, which is still good but more in-line with the Pratap Singh

broader market. Analyst

pratap-za.singh@ubs.com

We think the move higher in Industrial AI companies is sustainable and we +1-212-821 3112

expect further gains in the coming quarters. Zachary Walljasper

We believe earnings power for these companies can surprise meaningfully to the upside. Associate Analyst

zachary.walljasper@ubs.com

For example, recent disclosures from GEV point to gas turbine equipment margins of

+1-212-713 9829

about 35%, which should allow earnings power to eclipse $50 per share by the end of

this decade. We also see potential for a quintupling in earnings power at VRT over the

same time period.

Order activity should support increased confidence in this outlook.

Vertiv is aggressively increasing capacity, including a significant increase in Mexico. We

think this new capacity positions the company well in capturing meaningful new orders