Wednesday, January 22, 2025

"GE Vernova Hits A High As Troubled Wind Energy Unit Improves" (GEV)

I'm not sure the wind business is much of a driver for either the company or the stock, at least not this year. As we've mentioned, GEV is involved, one way or another, with something on the order of 30% of the world's electricity production. You want a gas-turbine co-gen set-up for your data center? Just call the sales peeps from General Electric, they've been doing it since 1882.*

From Investor's Business Daily, January 22:

GE Vernova (GEV) maintained its 2025 outlook early Wednesday after missing revenue estimates for the fourth quarter of 2024 due to weakness in offshore wind energy. GEV stock rose to a new high, continuing a huge rally for the S&P 500 member since its April 2024 debut.

Vernova holds the gas power and renewable energy assets of the former General Electric.

GE Vernova Earnings
GE Vernova reported earnings of $1.73 a share. It's unclear if that's comparable to FactSet estimates for a 244% spike to $2.30 a share.

Revenue rose 5.1% to $10.56 billion, but that slightly missed estimates for $10.702 billion.

Wind orders plunged 41% to $2.031 billion. But power orders swelled 20% to $6.55 billion and electrification orders jumped 118% to $4.79 billion.

For Q4, GE Vernova highlighted improvement in the wind energy business, which turned "modestly profitable" despite tumbling orders. Onshore wind delivered "its most profitable quarter in three years" on 48% revenue growth and offshore wind reduced losses despite 58% lower revenue, an earnings release and presentation showed. For the year, the wind energy unit slashed losses nearly in half to $588 million. The company tied the 41% dive in Q4 2024 orders to "a large U.S. onshore wind order in the fourth quarter of 2023."

Vernova on Wednesday reaffirmed 2025 guidance of $36 billion-$37 billion in revenue and $2 billion-$2.5 billion in free cash flow. It also touted "significant margin expansion and cash generation."

For 2025, analysts anticipate Vernova earnings of $6.87 a share, a 57% increase from 2024, FactSet shows.

GE Vernova Stock
In Wednesday's stock market trading, GEV stock rose 3% to 428.59, reaching the best level since its debut last year.

In intraday action, GE Vernova stock hit the profit-taking sell zone from its Jan. 6 breakout past a 357.09 buy point, according to MarketSurge charts. The energy spinoff reached that area relatively quickly, meaning investors could use the eight-week hold rule for stocks breaking out of proper bases and showing the potential for further gains.

Vernova stock has more than tripled from its April 2024 debut price of $115....

....MUCH MORE
*Speaking of General Electric: "Honey, I Forgot the Anniversary: Edison's Pearl Street Station" (GE)

GEV is trading at $425.38 up $9.38 (+2.25%) after setting a new all time high at $434.10.

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