Generac (NYSE:GNRC) Shares Gap Up After Strong Earnings

Key Points

• Generac Holdings Inc. experienced a significant stock price increase, opening at $165.00 after closing at $151.32 due to better than expected earnings of $1.65 per share, surpassing analyst predictions of $1.35.
• Research analysts issued a mix of ratings on Generac, with target prices reflecting a downward trend, yet a majority maintaining a "buy" rating, signaling confidence in its potential growth.
• CEO Aaron Jagdfeld recently sold 5,000 shares at an average of $142.40, reducing his ownership stake, while hedge fund activity showed a mix of increases and new acquisitions in Generac's stock.

Generac Holdings Inc. (NYSE:GNRC - Get Free Report)'s stock price gapped up prior to trading on Wednesday following a better than expected earnings announcement. The stock had previously closed at $151.32, but opened at $165.00. Generac shares last traded at $161.69, with a volume of 424,137 shares trading hands.

The technology company reported $1.65 EPS for the quarter, beating the consensus estimate of $1.33 by $0.32. Generac had a net margin of 7.91% and a return on equity of 19.14%. The firm had revenue of $1.06 billion during the quarter, compared to the consensus estimate of $1.03 billion. During the same quarter in the prior year, the firm earned $1.35 earnings per share. The business's quarterly revenue was up 6.3% on a year-over-year basis.

Wall Street Analysts Forecast Growth

Several equities research analysts have recently issued reports on the stock. TD Securities lowered their price objective on shares of Generac from $173.00 to $155.00 and set a "buy" rating for the company in a research report on Thursday, May 1st. Piper Sandler reduced their target price on shares of Generac from $175.00 to $155.00 and set an "overweight" rating for the company in a report on Thursday, April 17th. Canaccord Genuity Group reduced their target price on shares of Generac from $200.00 to $180.00 and set a "buy" rating for the company in a report on Thursday, May 1st. Robert W. Baird reduced their target price on shares of Generac from $171.00 to $127.00 and set a "neutral" rating on the stock in a report on Thursday, May 1st. Finally, Citigroup raised shares of Generac from a "neutral" rating to a "mixed" rating in a report on Friday, July 11th. Six equities research analysts have rated the stock with a hold rating and fourteen have given a buy rating to the company's stock. Based on data from MarketBeat, Generac currently has a consensus rating of "Moderate Buy" and a consensus price target of $174.58.

Insider Buying and Selling

In other Generac news, CEO Aaron Jagdfeld sold 5,000 shares of the company's stock in a transaction dated Tuesday, July 1st. The shares were sold at an average price of $142.40, for a total transaction of $712,000.00. Following the sale, the chief executive officer directly owned 562,966 shares of the company's stock, valued at $80,166,358.40. This represents a 0.88% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. 2.70% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Generac

Several institutional investors have recently added to or reduced their stakes in the business. Vanguard Group Inc. lifted its holdings in Generac by 2.0% during the first quarter. Vanguard Group Inc. now owns 6,932,913 shares of the technology company's stock valued at $878,053,000 after purchasing an additional 137,363 shares during the last quarter. Ariel Investments LLC boosted its position in shares of Generac by 10.1% in the first quarter. Ariel Investments LLC now owns 1,615,878 shares of the technology company's stock valued at $204,651,000 after acquiring an additional 148,551 shares during the period. Geode Capital Management LLC boosted its position in shares of Generac by 1.0% in the fourth quarter. Geode Capital Management LLC now owns 1,441,772 shares of the technology company's stock valued at $223,293,000 after acquiring an additional 14,844 shares during the period. Invesco Ltd. boosted its position in shares of Generac by 25.3% in the first quarter. Invesco Ltd. now owns 1,414,514 shares of the technology company's stock valued at $179,148,000 after acquiring an additional 285,388 shares during the period. Finally, Dimensional Fund Advisors LP boosted its position in shares of Generac by 18.0% in the first quarter. Dimensional Fund Advisors LP now owns 859,999 shares of the technology company's stock valued at $108,914,000 after acquiring an additional 131,460 shares during the period. 84.04% of the stock is owned by hedge funds and other institutional investors.

Generac Price Performance

The business's 50-day moving average price is $139.18 and its 200 day moving average price is $134.20. The company has a market capitalization of $11.43 billion, a P/E ratio of 32.15, a price-to-earnings-growth ratio of 1.64 and a beta of 1.72. The company has a quick ratio of 0.89, a current ratio of 2.00 and a debt-to-equity ratio of 0.50.

About Generac

Generac Holdings Inc designs, manufactures, and distributes various energy technology products and solution worldwide. The company offers residential automatic standby generators, automatic transfer switch, air-cooled engine residential standby generators, and liquid-cooled engine generators; Mobile Link, a remote monitoring system for home standby generators; residential storage solution, which consists of a system of batteries, an inverter, photovoltaic optimizers, power electronic controls, and other components; smart home solutions, such as smart thermostats and a suite of home monitoring products.