GE Vernova Inc. Sees Skyrocketing Stock Performance Amid Strong Sector Growth
Valued at a market cap of $101.4 billion, GE Vernova Inc. (GEV) is transforming the energy sector by providing innovative solutions for electricity generation, transfer, conversion, and storage. The company operates through three main segments: Power, Wind, and Electrification, offering advanced technologies and services in each category.
Impressive Stock Gains Outshine Market Trends
In a remarkable display of performance, shares of this sustainable energy company have outstripped the broader market over the past six months. GEV has surged 124.4%, compared to the S&P 500 Index ($SPX), which has rallied just 15.9%. Year-to-date, GEV shares are up 12.1%, in contrast to SPX’s 3.2% gain.
Strong Performance Compared to Sector Peers
Drilling down further, Cambridge, Massachusetts-based GEV has also outpaced the Industrial Select Sector SPDR Fund’s (XLI) 12.5% return over the last six months and a 4.2% gain year-to-date.
Q4 Results Spark Investor Confidence
Despite a weaker-than-expected Q4 earnings per share of $1.73 and revenue amounting to $10.6 billion, GE Vernova’s stock rose 2.7% on January 22. This uptick is largely due to notable advancements in the Power and Electrification segments, marked by significant margin expansions and a bolstered equipment backlog, which reassured investors. The Wind segment also exhibited recovery, fueled by Onshore Wind’s best quarter in three years and reduced losses in Offshore Wind. GE Vernova has reaffirmed its projection of $36 billion to $37 billion in revenue for 2025 with anticipated high-single-digit adjusted EBITDA margins.
Future Expectations and Analyst Consensus
Looking ahead, analysts forecast that GEV’s earnings per share (EPS) will grow 174.6% year-over-year to $6.59 for the fiscal year ending December 2025. The company’s earnings surprise record is mixed, having exceeded consensus estimates in two of the last four quarters while falling short in the other two.
A consensus among 25 analysts rates the stock as a “Strong Buy,” based on 18 “Strong Buy” ratings, two “Moderate Buys,” and five “Holds.”
This outlook is more favorable now compared to three months ago, when there were only 16 “Strong Buy” ratings.
Recent Analyst Upgrades
On December 12, 2024, JPMorgan analyst Mark Strouse increased GEV’s price target to $367, while maintaining an “Overweight” rating. This adjustment follows the company’s fiscal 2025 guidance, which came in slightly below consensus expectations due to challenges within the Wind segment, alongside the announcement of a $6 billion share repurchase authorization and a modest dividend.
At the time of this writing, GEV is trading below the mean price target of $416.35. The highest price target of $500 suggests a possible upside of 33.1% from current levels.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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