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Generac Reaches 52-Week High

Zacks Equity Research

Shares of Generac Holdings Inc. (GNRC) hit a new 52-week high of $57.05 on Dec 24, and eventually closed at $56.13. Share prices of this diversified machinery company have been on a rise due to its strong inorganic growth momentum.

Year-to-date, Generac’s share prices have recorded a healthy return of 81.7%. The company’s long-term estimated earnings per share growth rate is 10.3%. Average volume of shares traded over the last three months came in at 764K.

Growth Drivers

Generac has been performing well in the past few quarters and intends to grow further. In concurrence with the same, the company recently acquired the generators products division of Baldor Electric Company. The assets acquired will complement Generac Holdings’ existing line of business and enable deeper penetration into the North American and international markets served by Baldor Electric’s generator division. Products including portable, mobile, standby and prime power generators ranging from 3kW to 2.5MW are expected to be added to the company’s portfolio.

Earlier in Aug 2013, the company acquired Tower Light Srl and its subsidiaries from the European private equity fund, Ambienta I. Based in Italy, Tower Light is a leader in the development and supply of mobile light towers. Additionally, the company has been launching products to gain a higher market share.

Generac reported positive earnings surprise in all the four previous quarters, with the average surprise for the same being 25.6%. The growth in business is reflected in the upward revision of the sales and earnings guidance for 2013.

Other Stocks to Consider

With a Zacks Rank #2 (Buy), Generac currently has a market capitalization of $3.9 billion. Some other stocks in the industry worth a watch include Xylem Inc. (XYL), DXP Enterprises, Inc. (DXPE) and Graham Corp. (GHM). While Xylem carries a Zacks Rank #1 (Strong Buy), Graham Corp. and DXP Enterprises hold a Zacks Rank #2.

Read the Full Research Report on DXPE
Read the Full Research Report on XYL
Read the Full Research Report on GHM
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