Core Insights - Generac Holdings reported revenue of $1.11 billion for the quarter ended September 2025, reflecting a year-over-year decline of 5.1% and an EPS of $1.83, down from $2.25 a year ago [1] - The revenue fell short of the Zacks Consensus Estimate of $1.2 billion by 7.44%, and the EPS also missed the consensus estimate of $2.25 by 18.67% [1] Revenue Breakdown - Revenue from Residential products was $626.71 million, significantly below the average estimate of $714.3 million, marking a year-over-year decline of 13.3% [4] - Revenue from Other products was $129.37 million, slightly above the average estimate of $127.9 million, showing a year-over-year increase of 5.3% [4] - Revenue from Commercial & Industrial products reached $358.27 million, exceeding the average estimate of $352.7 million, with a year-over-year increase of 9.2% [4] Stock Performance - Over the past month, shares of Generac Holdings have returned +13.6%, outperforming the Zacks S&P 500 composite's +3.8% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

Core Insights - Generac Holdings reported quarterly earnings of $1.83 per share, missing the Zacks Consensus Estimate of $2.25 per share, representing an earnings surprise of -18.67% [1] - The company posted revenues of $1.11 billion for the quarter ended September 2025, missing the Zacks Consensus Estimate by 7.44% [2] - Generac Holdings has outperformed the S&P 500 with a 22.6% gain since the beginning of the year compared to the S&P 500's 17.2% gain [3] Earnings Performance - The company has surpassed consensus EPS estimates three times over the last four quarters [2] - The current consensus EPS estimate for the coming quarter is $2.50 on $1.24 billion in revenues, and for the current fiscal year, it is $7.56 on $4.44 billion in revenues [7] Market Outlook - The estimate revisions trend for Generac Holdings was unfavorable ahead of the earnings release, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6] - The outlook for the Manufacturing - General Industrial industry, to which Generac belongs, is currently in the bottom 37% of over 250 Zacks industries, which may impact stock performance [8]

Core Insights - Premarket trading is showing notable activity with significant price movements indicating potential trading opportunities before the market opens [1] Premarket Gainers - Cambium Networks Corporation (CMBM) has seen a remarkable increase of 306%, trading at $2.51 [3] - Teradyne, Inc. (TER) is up 21%, currently priced at $176.00 [3] - Bloom Energy Corporation (BE) has risen by 18%, trading at $134.50 [3] - Jamf Holding Corp. (JAMF) is up 15%, with a price of $12.85 [3] - CSG Systems International, Inc. (CSGS) has increased by 14%, trading at $79.00 [3] - Olympic Steel, Inc. (ZEUS) is also up 14%, currently priced at $34.20 [3] - Beta Bionics, Inc. (BBNX) has risen by 12%, trading at $27.20 [3] - Sonim Technologies, Inc. (SONM) is up 10%, currently priced at $12.49 [3] - Canadian Solar Inc. (CSIQ) has increased by 9%, trading at $16.67 [3] - Interlink Electronics, Inc. (LINK) is also up 9%, currently priced at $6.85 [3] Premarket Losers - Stride, Inc. (LRN) has experienced a significant decline of 41%, trading at $89.44 [4] - Varonis Systems, Inc. (VRNS) is down 29%, currently priced at $44.71 [4] - Akebia Therapeutics, Inc. (AKBA) has decreased by 26%, trading at $2.26 [4] - Avantor, Inc. (AVTR) is down 17%, currently priced at $12.40 [4] - GlucoTrack, Inc. (GCTK) has seen a decline of 13%, trading at $6.29 [4] - Tigo Energy, Inc. (TYGO) is down 13%, currently priced at $2.20 [4] - Generac Holdings Inc. (GNRC) has decreased by 9%, trading at $172.00 [4] - Polar Power, Inc. (POLA) is down 8%, currently priced at $3.71 [4] - Caesars Entertainment, Inc. (CZR) has seen a decline of 7%, trading at $20.50 [4] - Anteris Technologies Global Corp. (AVR) is also down 7%, currently priced at $4.46 [4]

Core Viewpoint - Power equipment maker Generac has lowered its full-year net sales growth forecast due to weaker demand for home standby and portable generators, attributed to a decline in power outages, resulting in a 9% drop in shares [1] Company Summary - Generac has revised its net sales growth forecast downward, indicating challenges in the market for home standby and portable generators [1] - The decline in power outages has significantly impacted demand for Generac's products, leading to the forecast adjustment [1] Industry Summary - The overall market for power equipment, particularly in the home standby and portable generator segment, is experiencing reduced demand due to fewer power outages [1]

Financial Performance - Net sales decreased 5% to $1.11 billion in Q3 2025, down from $1.17 billion in Q3 2024, with core sales down approximately 6%[5] - Adjusted EBITDA was $193 million, or 17.3% of net sales, compared to $232 million, or 19.8% of net sales, in the prior year[5] - Net income for the nine months ended September 30, 2025, was $185,288, down from $199,309 in 2024, a decrease of 7.0%[34] - Net income attributable to Generac Holdings Inc. for the three months ended September 30, 2025, was $66,161, a decrease of 41.8% from $113,742 in 2024[40] - Total adjusted EBITDA for the nine months ended September 30, 2025, was $530,390, slightly up from $523,787 in 2024[39] Sales Breakdown - Residential product sales fell approximately 13% to $627 million, while Commercial & Industrial (C&I) product sales increased approximately 9% to $358 million[5] - International segment sales increased approximately 11% to $185.5 million, driven by strength in C&I product shipments to European markets[11] - Domestic net sales for the nine months ended September 30, 2025, increased to $2,604,937, up 2.1% from $2,567,813 in 2024[37] - Residential products net sales for the three months ended September 30, 2025, were $626,706, a decrease of 13.3% from $722,787 in 2024[37] - International net sales for the nine months ended September 30, 2025, were $568,237, an increase of 9.0% from $537,918 in 2024[37] Profitability Metrics - Gross profit margin was 38.3%, down from 40.2% in the prior-year quarter, primarily due to unfavorable sales mix and higher tariffs[4] - Adjusted EBITDA margin is now expected to be approximately 17.0%, down from the previous guidance of 18.0% to 19.0%[14] - Adjusted EBITDA for the international segment was $27.4 million, or 14.8% of total sales, up from $20.3 million, or 12.2% of total sales, in the prior year[12] Cash Flow and Liquidity - Cash flow from operations was $118 million, down from $212 million in the prior year, with free cash flow at $96 million compared to $184 million in Q3 2024[5][8] - The company reported a net cash provided by operating activities of $248,719 for the nine months ended September 30, 2025, down from $401,847 in 2024, a decrease of 38.1%[34] - Free cash flow for the three months ended September 30, 2025, was $96,497, down 47.5% from $183,658 in 2024[46] Guidance and Future Outlook - The company updated its full-year 2025 net sales guidance to be approximately flat compared to the prior year, down from a previous forecast of 2% to 5% growth[13] - The backlog for large-megawatt generators in the data center market has doubled over the last 90 days, indicating strong future demand[3] Expenses - Operating expenses increased to $917,151 for the nine months ended September 30, 2025, compared to $825,481 in 2024, representing an increase of 11.1%[32] - Research and development expenses for Q3 2025 were $60,059, up from $56,936 in Q3 2024, indicating a growth of 3.9%[32] - The company incurred legal expenses related to patent lawsuits amounting to $2.7 million for the three months ended September 30, 2025[47] - The company reported a provision for a $15.0 million multi-district class action settlement related to clean energy products, totaling $17.8 million for the three months ended September 30, 2025[47] Balance Sheet Highlights - Cash and cash equivalents increased to $300,009 as of September 30, 2025, compared to $281,277 at the end of 2024, an increase of 6.1%[34] - Total assets grew to $5,598,102 as of September 30, 2025, up from $5,109,331 at the end of 2024, an increase of 9.6%[30] - Total liabilities increased to $2,948,274 as of September 30, 2025, compared to $2,611,888 at the end of 2024, an increase of 12.9%[30] - Stockholders' equity attributable to Generac Holdings Inc. increased to $2,643,748 as of September 30, 2025, compared to $2,494,278 at the end of 2024, an increase of 6.0%[30]

Core Insights - Generac Holdings Inc. reported a decrease in net sales by 5% to $1.11 billion for Q3 2025, compared to $1.17 billion in Q3 2024, primarily due to lower demand for home standby and portable generators amid a significantly reduced power outage environment [5][12][30] - The company experienced a gross profit margin decline to 38.3% from 40.2% year-over-year, attributed to an unfavorable sales mix, higher tariffs, and lower manufacturing absorption, although partially offset by increased price realization [4][5] - Adjusted net income for Q3 2025 was $108 million, or $1.83 per share, down from $136 million, or $2.25 per share, in the same period last year [5][30] Financial Performance - Operating expenses rose by $20.2 million, or 6.7%, compared to Q3 2024, due to legal and regulatory charges [5] - Net income attributable to the company was $66 million, or $1.12 per share, compared to $114 million, or $1.89 per share, in Q3 2024 [5][30] - Adjusted EBITDA for the quarter was $193 million, representing 17.3% of net sales, down from $232 million, or 19.8% of net sales, in the prior year [5][30] Segment Performance - Domestic segment sales decreased approximately 8% to $938.1 million, driven by weaker home standby and portable generator sales, partially offset by growth in residential energy technology and C&I product sales [8][9] - International segment sales increased approximately 11% to $185.5 million, supported by strong C&I product shipments to European markets and initial shipments of large-megawatt generators to data center customers [10][11] Outlook - The company has revised its full-year 2025 net sales guidance to be approximately flat compared to the previous year, down from an earlier forecast of a 2% to 5% increase [12][13] - Adjusted EBITDA margin is now expected to be around 17.0%, lower than the previous guidance of 18.0% to 19.0% [13]

Core Viewpoint - Generac Holdings Inc (NYSE:GNRC) is highlighted as a top stock to watch, particularly in the context of an AI-led bull market and the anticipated flow of investments into small-cap stocks due to the Federal Reserve's rate cut cycle [1][2]. Group 1: Investment Potential - Chris Retzler, a portfolio manager at Needham, emphasizes the strong growth potential of small-cap stocks, with Generac being a favored choice due to its backup power generation products for various markets [2]. - Generac is noted for its data center solutions, specifically diesel backup generation, which is expected to see increased demand as the company introduces new competitive products [2]. - The Diamond Hill Small-Mid Cap Fund initiated a position in Generac Holdings during the second quarter of 2025, indicating a belief in its compelling valuation despite market volatility [3]. Group 2: Market Context - The current investment climate is characterized by a shift towards small-cap stocks, driven by the Federal Reserve's monetary policy, which is expected to enhance liquidity and investment opportunities in this segment [2]. - There is a recognition that while Generac has potential, some AI stocks may offer higher returns with lower risk, suggesting a competitive landscape for investment choices [4].

Core Insights - Generac Holdings Inc. (GNRC) is set to report its third-quarter 2025 results on October 29, with revenue expectations of $1.2 billion, reflecting a 2.6% increase year-over-year [1] - The consensus estimate for earnings is $2.25 per share, remaining flat compared to the previous year, although it has decreased by 2 cents in the past week [1] Financial Performance - GNRC has consistently exceeded the Zacks Consensus Estimate for earnings in the last four quarters, achieving an average surprise of 19.24% [2] - Over the past year, GNRC shares have increased by 15.8%, outperforming the Zacks Manufacturing-General Industrial industry's growth of 5.9% [3] Factors Influencing Q3 Results - Strong demand for portable generators and increased shipments of residential-energy technology products are expected to enhance the Residential segment's performance [4] - The number of connected ecobee homes has surpassed 4.5 million, driven by rising energy services and subscription rates [4] - New product launches, including PWRcell 2 MAX and next-generation home standby generators, along with investments in manufacturing capacity, are anticipated to be growth catalysts [5] Segment Performance - Residential Product sales are projected to be slightly lower than previous guidance due to revised pricing assumptions and subdued installation activity [9] - The consensus estimate for Residential products' revenues is $714 million [9] - Commercial & Industrial (C&I) sales are expected to grow, with a 5% increase noted in the second quarter, supported by domestic industrial distributors and telecom spending [10] - The consensus estimate for C&I products' revenues is $353 million [10] New Developments - Generac's entry into large megawatt backup generator solutions for hyperscale and AI-driven data centers is a significant development, with a global backlog exceeding $150 million [11] - The company anticipates a sequential increase in EBITDA margins by 150-200 basis points due to higher seasonal sales volumes [12] Market Conditions - Despite positive trends, there are concerns regarding soft shipments to rental equipment customers and ongoing macroeconomic challenges, including tariff issues and rising operating costs [12] - Current earnings expectations indicate a negative Earnings ESP of -6.79% and a Zacks Rank of 4 (Sell), suggesting a lower likelihood of an earnings beat this quarter [13]

Company Overview - Generac provides total energy solutions, including power generation equipment, energy storage systems, and energy management devices, serving light commercial, industrial, and residential markets [2] - The company has been operational since 1959 and is a leader in North America's generator market, with a valuation exceeding $10 billion [2] Market Demand and Trends - There is a growing demand for reliable power infrastructure, particularly driven by the expansion of data centers, which consumed approximately 415 TWh of power last year and is projected to reach 945 TWh by 2030 [4] - Major tech firms like Microsoft, Amazon, Meta, and Alphabet are significantly increasing their capital spending on data center construction, with combined expenditures reaching about $245 billion last year and approaching $360 billion [5] Product Applications - Generac's products cater to various applications, including portable power, home backup, solar power storage, and EV charging, ensuring essential electricity supply under all conditions [1] - The company offers industrial-strength diesel-powered generators that meet the high power demands of data centers [7] Financial Performance - In Q2 2025, Generac reported a revenue of $1.06 billion, a 6% year-over-year increase, surpassing forecasts by nearly $35 million [8] - The net income for the quarter was $74 million, translating to $1.25 per share, which exceeded expectations by $0.22 [8] Analyst Insights - Analyst Sean Milligan from Needham highlights that Generac's stock surged by up to 29% following the Q2 2025 earnings release, attributing this to the company's focus on the data center business [9] - Milligan projects a $250 million revenue from data centers in 2026, with an adjusted EBITDA margin of approximately 17.5%, potentially scaling to a $500 million run-rate in 2027 [10] Stock Ratings - Generac has a Moderate Buy consensus rating from analysts, with 16 recent reviews showing an equal split of 8 Buys and Holds [12] - The current share price is $189.04, with an average target price of $207.14, indicating a potential gain of 9.5% over the next year [12]

Core Insights - Conestoga Capital Advisors reported that equity markets reached new all-time highs in Q3 2025, but their Smid Cap Composite underperformed the Russell 2500 Growth Index, returning -1.1% net-of-fees compared to the index's +10.7% [1] Company Overview - Generac Holdings Inc. (NYSE:GNRC) is highlighted as a key stock, known for manufacturing power generation equipment and energy storage systems [2][3] - The stock closed at $190.49 on October 17, 2025, with a market capitalization of $11.177 billion [2] Performance Metrics - Generac Holdings Inc. achieved a one-month return of 4.50% and a 52-week gain of 13.87% [2] - The company's net sales increased by 6% year-over-year to $1.06 billion in Q2 2025 [4] Market Dynamics - Demand for Generac's products has been driven by extreme weather events and concerns over grid reliability, leading to increased sales momentum [3] - Favorable dealer activity and channel restocking trends have also contributed to the company's near-term sales growth [3] Investment Sentiment - Despite the potential of Generac Holdings Inc., some analysts suggest that certain AI stocks may offer greater upside potential with less downside risk [4]