Generac (GNRC): Reassessing Valuation After Recent Pullback and Tentative Share Price Rebound

Generac Holdings stock reaction and recent performance

Generac Holdings (GNRC) shares have drifted recently, slipping about 4 % in the past day while still edging higher over the past month, and that mix of short term weakness and recent strength has investors reassessing the setup.

See our latest analysis for Generac Holdings.

Zooming out, Generac’s 1 month share price return of 6.31 percent and modest year to date gain sit against a softer 1 year total shareholder return of minus 3.89 percent, suggesting momentum is tentatively rebuilding after a tougher stretch.

If this kind of rebound story interests you, it is a good moment to explore other industrial names and see what stands out in aerospace and defense stocks.

With earnings and revenue both growing at a healthy clip, and the share price still trading at a notable discount to analyst targets, investors now face a key question: Is Generac undervalued, or is future growth already priced in?

Most Popular Narrative: 23.3% Undervalued

Compared with the last close of $160.75, the most popular narrative pegs Generac’s fair value materially higher, framing today’s price as a potential discount and spotlighting the drivers behind that gap.

Structural improvements in gross margins, supported by favorable pricing realization, supply chain efficiencies, and cost control initiatives, are driving durable improvement in EBITDA margins (raised outlook to 18 to 19%) as the energy technology segment's development costs subside and C&I revenue scales, margin expansion is likely to be sustainable through 2026 and beyond.

Read the complete narrative.

Curious how rising margins, ambitious earnings targets, and a rich future profit multiple all combine into that upside case? The full narrative unpacks every assumption.

Result: Fair Value of $209.59 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, weaker home standby demand and ongoing profitability challenges in clean energy could quickly undermine the margin expansion and growth assumed in this upside case.

Find out about the key risks to this Generac Holdings narrative.

Build Your Own Generac Holdings Narrative

If this view does not quite align with your own, or you would rather dig into the numbers yourself, you can build a personalized story for Generac in just a few minutes, Do it your way.

A good starting point is our analysis highlighting 4 key rewards investors are optimistic about regarding Generac Holdings.

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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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