Can Power Utility Demand Boost nVent Electric's Long-Term Growth?

nVent Electric NVT is seeing strong demand in its power utilities business as electricity needs continue to rise. Power utilities grew double digits in the second quarter of 2026. Management said the growth is being supported by rising electricity demand, an aging grid and higher power requirements from data centers. The company expects power utilities to remain an important part of its infrastructure growth opportunity.

The growing use of AI is adding another source of demand. Due to rising computing needs, AI data centers require more power, which is leading to rising investment in power infrastructure. NVT serves utilities directly as well as through distribution partners. The company sees opportunities in engineered buildings and other infrastructure used around data centers as well. This gives the company an opportunity to benefit from higher power demand beyond its direct data center business.

NVT has been increasing its exposure to infrastructure, with data centers and power utilities as key areas of focus. Infrastructure accounted for nearly 60% of sales in the first half of 2026 compared with 45% in 2025. The company expects to spend about $130 million on capital expenditures in 2026, up 40% year over year. Most of the higher investment is going toward capacity for data centers, power utilities and supply-chain resilience.

The power utilities business could therefore provide NVT with another source of growth as electricity demand increases. Grid modernization and the aging power grid also support the long-term opportunity. Management said it is planning ahead with customers and suppliers to make sure it can support both markets. With double-digit power utility growth already visible and continued investment in infrastructure, the business could become an increasingly important growth driver for NVT.

The Zacks Consensus Estimate for nVent Electric’s 2026 and 2027 revenues indicates year-over-year growth of 39.96% and 18.14%, respectively.

How Do Competitors Fare Against NVT

nVent Electric competes with companies like Amphenol Corporation APH and Hubbell HUBB in the electrical infrastructure and equipment market.

Amphenol offers high-speed and power interconnect solutions through its IT Datacom business. The company is benefiting from the rapid expansion of AI data centers, particularly through rising demand for high-speed connectivity, optics and power interconnect products. In its second quarter of 2026, Amphenol’s IT datacom sales grew 63% organically year over year, on strong AI-related demand. Further, management expects another mid-teens sequential increase in the third quarter of 2026, buoyed by strong demand for high-speed copper, fiber-optic and power solutions as AI systems become more complex.

In June 2026, Hubbell completed the acquisition of NSI Industries, a key manufacturer and supplier of electrical products. The acquisition is expected to strengthen Hubbell’s offerings in areas such as light industrial, data center and network infrastructure applications. Here, electrification trends are expected to support Hubbell's growth across the electrical industry, and the acquisition will help Hubbell expand its portfolio of infrastructure-related products for its electrical and utility customers.

NVT's Price Performance, Valuation & Estimates

Shares of nVent Electric have surged 45.3% year to date against the Zacks Electronics - Miscellaneous Components industry’s decline of 20%.

nVent Electric YTD Price Return Performance

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From a valuation standpoint, nVent Electric trades at a forward price-to-sales ratio of 3.92X, higher than the industry’s average of 3.59X. NVT has a Value Score of D.

NVT Forward 12-Month P/S Ratio

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The Zacks Consensus Estimate for nVent Electric’s 2026 and 2027 earnings per share (EPS) implies year-over-year growth of 53.1% and 24.5%, respectively. EPS estimates for 2026 and 2027 have been revised upward by 7.3% and 5.3%, respectively, over the past 30 days.

Image Source: Zacks Investment Research

nVent Electric currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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