Shareholders of Generac Holdings Inc. (NYSE:GNRC) will be pleased this week, given that the stock price is up 13% to US$187 following its latest quarterly results. Revenues were US$1.2b, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of US$1.89 were also better than expected, beating analyst predictions by 14%. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the most recent consensus for Generac Holdings from 23 analysts is for revenues of US$4.67b in 2025. If met, it would imply a meaningful 13% increase on its revenue over the past 12 months. Per-share earnings are expected to leap 44% to US$7.10. In the lead-up to this report, the analysts had been modelling revenues of US$4.66b and earnings per share (EPS) of US$6.90 in 2025. So the consensus seems to have become somewhat more optimistic on Generac Holdings' earnings potential following these results.
The consensus price target rose 5.4% to US$175, suggesting that higher earnings estimates flow through to the stock's valuation as well. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Generac Holdings, with the most bullish analyst valuing it at US$210 and the most bearish at US$94.00 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that Generac Holdings' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 10% growth on an annualised basis. This is compared to a historical growth rate of 14% over the past five years. Compare this to the 129 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 8.3% per year. Factoring in the forecast slowdown in growth, it looks like Generac Holdings is forecast to grow at about the same rate as the wider industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Generac Holdings' earnings potential next year. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Generac Holdings going out to 2026, and you can see them free on our platform here.
Plus, you should also learn about the 1 warning sign we've spotted with 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.
