Is GE Vernova a Good Value After Surging 79% So Far in 2025?

Thinking about what to do with GE Vernova stock these days? You are not alone. Whether you are considering taking profits after a banner run or nervous about missing out, this stock has grabbed plenty of investor attention lately. After a whopping 79% year-to-date surge, a steady climb of over 30% in the past three months, and a new life at over $600 per share, GE Vernova’s momentum speaks for itself. Investors betting on the clean energy transition and infrastructure upgrades have helped propel these gains, adjusting their risk calculations upward in the wake of strong revenue and net income growth. It is fair to say this company has moved beyond the “wait and see” phase. Now the question is, what is it actually worth?

That brings us to valuation. GE Vernova checks just 1 out of 6 boxes for undervaluation, giving it a modest value score. While that alone does not tell the whole story, it does set the stage for a deeper dive. In the next section, we will break down the most common valuation methods analysts use to evaluate whether GE Vernova is a bargain or if it is running a little hot. Stick around, as there is an even smarter angle we will save for the end of this article.

GE Vernova delivered 226.4% returns over the last year. See how this stacks up to the rest of the Electrical industry.

Approach 1: GE Vernova Cash Flows

A Discounted Cash Flow (DCF) model is a common valuation tool that estimates a company's value by forecasting its future cash flows and then discounting them back to today to find their present worth. It is a way of asking, "What are all the future dollars GE Vernova will bring in really worth right now?"

For GE Vernova, the latest reported Free Cash Flow stands at $2.74 billion. Analysts expect this figure to steadily grow over the coming years and project it will reach $14.56 billion by 2035. These rising amounts reflect confidence in the company’s ability to execute on long-term energy infrastructure demand.

Based on the 2 Stage Free Cash Flow to Equity model, GE Vernova’s estimated intrinsic value is $647.57 per share. Comparing this fair value to today's stock price shows GE Vernova is trading at about 6.4% below its intrinsic value. This means the stock is approximately 6.4% undervalued using this approach.

Result: ABOUT RIGHT

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out GE Vernova's DCF analysis). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes.

Approach 2: GE Vernova Price vs Earnings

The Price-to-Earnings (PE) ratio is one of the most useful tools for valuing profitable companies like GE Vernova because it links a company’s share price to its actual earnings. This multiple helps investors estimate how much they are paying for each dollar of current profit, and is most meaningful when a business is already generating steady earnings.

A normal or “fair” PE ratio is influenced by how quickly investors expect a company’s earnings to grow compared to the risks they see ahead. Fast-growing companies usually command higher PE ratios, while those facing more risk or slower growth generally have lower multiples.

Currently, GE Vernova trades at a PE of 143x, which is significantly above the Electrical industry average of 30x and well above the average for its peers at 26x. Simply Wall St’s proprietary Fair Ratio for GE Vernova is calculated as 68.64x, reflecting the company’s unique mix of growth potential, market position, and risk factors. Compared to this Fair Ratio, GE Vernova’s current PE multiple is more than twice as high, suggesting that the market has high expectations priced in at current levels.

Result: OVERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your GE Vernova Narrative

A Narrative is simply the story you believe about a company, your perspective on its future, which you link to the numbers by setting your own fair value and estimates for revenue, earnings, and margins. Narratives connect the dots between a company’s business outlook, a financial forecast, and what you consider a reasonable share price. This framework helps you invest with conviction rather than guesswork.

This approach is easy and accessible for everyone, especially within the Simply Wall St community where millions of investors create, compare, and update Narratives using built-in tools. Narratives help you decide when to buy or sell by comparing your fair value with the market price. Crucially, they update automatically as fresh news or earnings are released, keeping your view current.

For example, one GE Vernova Narrative might forecast $6.4 billion in earnings by 2028 and a price target of $760 per share. A more cautious Narrative might see just $3.5 billion in earnings and a $280 price target. The difference comes down to the story you believe and the numbers you use.

Do you think there's more to the story for GE Vernova? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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