Strength Seen in Generac Holdings (GNRC): Can Its 7.9% Jump Turn into More Strength?
Generac Holdings GNRC shares rallied 7.9% in the last trading session to close at $128.87. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 1% gain over the past four weeks.
The increase in share price can be attributed to robust demand for Commercial & Industrial (C&I) products. Increasing power outage especially in the United States and Canada is likely to act as a tailwind for its home standby generators.
The company’s home standby shipments continue to gain momentum as field inventory is expected to normalize in the second half of 2023. The company’s thermostats product line is also expected to gain traction owing to increased energy costs and rising temperature.
This generator maker is expected to post quarterly earnings of $1.20 per share in its upcoming report, which represents a year-over-year change of -59.9%. Revenues are expected to be $984.84 million, down 23.7% from the year-ago quarter.
Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.
For Generac Holdings, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on GNRC going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Generac Holdings belongs to the Zacks Electronics - Power Generation industry. Another stock from the same industry, Babcock & Wilcow Enterprises BW, closed the last trading session 0.5% lower at $6.44. Over the past month, BW has returned 14.1%.
Babcock & Wilcox's consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.01. Compared to the company's year-ago EPS, this represents a change of -50%. Babcock & Wilcox currently boasts a Zacks Rank of #4 (Sell).
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