Generac Holdings (GNRC) AI Stock Analysis

• Market Cap: $10.45B
• Dividend Yield: N/A
• Average Volume (3M): 1.14M
• Price to Earnings (P/E): 29.6
• Beta (1Y): 1.45
• Revenue Growth: 9.69%
• EPS Growth: 54.29%
• Country: US
• Employees: 5,389
• Sector: Industrials
• Sector Strength: 75
• Industry: Industrial - Machinery
• EPS (TTM): 1.65
• Shares Outstanding: 58,675,950
• 10 Day Avg. Volume: 817,144
• 30 Day Avg. Volume: 1,136,062
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.92
• Enterprise Value/Revenue: 2.19
• Enterprise Value/Gross Profit: 5.48
• Enterprise Value/Ebitda: 13.79
• 1Y Price Target: $199.85
• Price Target Upside: 12.16% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 15

• Rating: 77 Outperform
• Price Target: $216.00 ▲(21.23% Upside)

Generac Holdings scores well due to strong financial performance and positive earnings call sentiment, highlighting strategic growth initiatives and robust revenue growth. Technical indicators support a bullish outlook, although valuation concerns due to a high P/E ratio and lack of dividend yield slightly dampen the overall score.

Positive Factors

Financial performance

Generac reported a strong second quarter, with key financial metrics including revenue and earnings above guidance and consensus expectations.

Market opportunity

Generac's entry into the data center market marks a multi-year growth inflection, with management calling it the most needle-moving opportunity in decades.

Product growth

The residential HSB segment continues to set the bar higher, new products will allow price increases, ecobee is reporting growth, and the telecom business is seeing increased spending.

Negative Factors

Competitive disadvantage

GNRC’s new PWRmicro line is only expected to start shipping later, so the company will likely be behind competitors seeing safe harbor deals.

Competitive pressure

Larger competitors in the data center space have deep relationships and proven scale, potentially limiting the company's ability to gain meaningful share.

Market challenges

The residential solar business underperformed due to a sluggish solar market, reputational challenges related to product recall, and limited market share.

Generac Holdings Business Overview & Revenue Model

Company Description

Generac Holdings Inc. is a leading manufacturer of backup power generation products and energy management solutions. Founded in 1959 and headquartered in Waukesha, Wisconsin, the company primarily operates in the residential, commercial, and industrial sectors. Generac's core product offerings include standby generators, portable generators, and energy storage systems, as well as advanced power management technologies designed to provide reliable energy solutions for customers facing power outages or seeking to optimize energy usage.

How the Company Makes Money

Generac generates revenue primarily through the sale of its power generation products, including residential and commercial standby generators, portable generators, and related accessories. The company also earns income through the sale of energy storage systems and smart energy management solutions. Key revenue streams include direct sales to consumers and businesses, as well as partnerships with distributors, retailers, and contractors who resell Generac's products. Additionally, Generac benefits from recurring revenue through service contracts and maintenance agreements for installed products. The growth in demand for backup power solutions, driven by increasing frequency of power outages and rising interest in renewable energy sources, significantly contributes to its earnings.

Generac Holdings Financial Statement Overview

Summary

Generac Holdings demonstrates strong financial health, driven by consistent revenue growth and strong cash flow generation. While profitability margins are solid, the declining EBITDA margin and increasing debt warrant attention. The company maintains a balanced capital structure, but should monitor leverage to sustain long-term growth and stability.

Income Statement

Generac Holdings exhibits solid profitability with a consistent gross profit margin of around 40% in recent periods. The net profit margin improved to 8.2% in TTM from 7.6% last year, indicating better cost management. Revenue growth has been steady with a 2.7% increase in TTM. However, the declining EBITDA margin from 15.6% in 2024 to 12.1% in TTM suggests increased operating expenses or lower efficiency.

Balance Sheet

The company maintains a stable balance sheet with a debt-to-equity ratio of 0.62 in TTM, reflecting moderate leverage. The equity ratio stands at 47.7%, indicating a solid capital structure. Return on equity improved to 14% in TTM, showcasing effective use of shareholders' funds. However, the rising total debt levels over time are a concern for future financial flexibility.

Cash Flow

Generac's cash flow position is strong, with a 13.1% growth in free cash flow in TTM, reflecting enhanced operational efficiency. The operating cash flow to net income ratio is robust at 1.89, indicating effective cash generation from operations. The free cash flow to net income ratio of 1.90 underscores the company's ability to convert earnings into cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.41B	4.30B	4.02B	4.56B	3.74B	2.49B
Gross Profit	1.76B	1.67B	1.37B	1.52B	1.36B	957.65M
EBITDA	700.19M	670.92M	554.53M	719.43M	816.52M	547.96M
Net Income	360.45M	325.26M	203.09M	350.27M	533.39M	349.33M
Balance Sheet
Total Assets	5.39B	5.11B	5.09B	5.17B	4.88B	3.24B
Cash, Cash Equivalents and Short-Term Investments	223.53M	281.28M	200.99M	132.72M	147.34M	655.13M
Total Debt	1.59B	1.48B	1.73B	1.60B	1.32B	1.07B
Total Liabilities	2.81B	2.61B	2.74B	2.80B	2.61B	1.78B
Stockholders Equity	2.57B	2.49B	2.34B	2.26B	2.21B	1.39B
Cash Flow
Free Cash Flow	683.52M	604.57M	392.61M	-27.67M	301.16M	424.40M
Operating Cash Flow	682.08M	741.30M	521.67M	58.52M	411.16M	486.53M
Investing Cash Flow	-228.00M	-208.71M	-178.06M	-134.23M	-817.29M	-124.09M
Financing Cash Flow	-453.64M	-448.83M	-277.14M	64.04M	-102.97M	-30.43M

Generac Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 178.18
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GNRC, the sentiment is Positive. The current price of 178.18 is below the 20-day moving average (MA) of 191.62, above the 50-day MA of 171.46, and above the 200-day MA of 148.66, indicating a neutral trend. The MACD of 1.78 indicates Positive momentum. The RSI at 44.06 is Neutral, neither overbought nor oversold. The STOCH value of 10.11 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GNRC.

Generac Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DCI	78 Outperform	$9.39B	26.10	24.94%	1.43%	2.92%	-9.78%
SPXC	78 Outperform	$8.73B	41.71	15.02%	―	8.90%	29.18%
GNRC	77 Outperform	$10.45B	29.59	14.59%	―	9.69%	54.29%
IEX	71 Outperform	$12.41B	26.04	12.25%	1.70%	4.73%	-19.15%
RRX	64 Neutral	$9.70B	38.86	3.84%	0.95%	-7.88%	―
Sector *	64 Neutral	$10.73B	15.65	7.61%	2.01%	2.80%	-14.92%
LASE	49 Neutral	$36.05M	―	-61.47%	―	123.75%	66.85%

Generac Holdings Corporate Events

Generac Holdings Amends Credit Agreement with Lenders

On July 1, 2025, Generac Holdings, Inc. and its subsidiaries amended their Credit Agreement with a syndicate of lenders, led by JPMorgan Chase Bank. The amendment includes replacing the existing term loan and revolving credit facilities with new ones, totaling $700 million and $1 billion respectively, both maturing on July 1, 2030. Additionally, the amendment eliminates the credit spread adjustment linked to the transition from LIBOR to SOFR and updates the credit spread pricing grid based on the Total Leverage Ratio.