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Generac to Report Q4 Earnings: Here's What Investors Should Know
GNRCGenerac (GNRC) ZACKS·2025-02-10 13:45

Core Viewpoint - Generac Holdings Inc (GNRC) is set to report its fourth-quarter 2024 results on February 12, with expectations of revenue and earnings growth driven by increased demand for home standby generators and portable generators due to extreme weather conditions [1][2][4]. Financial Performance Expectations - The Zacks Consensus Estimate for fourth-quarter revenues is 1.23billion,reflectinga15.71.23 billion, reflecting a 15.7% increase year-over-year, while earnings are estimated at 2.50 per share, up 20.8% year-over-year [2]. - GNRC has outperformed the Zacks Consensus Estimate in three of the last four quarters, with an average earnings surprise of 10.83% [3]. Demand Drivers - The anticipated performance boost is attributed to heightened demand for home standby generators amid increased power outages from hurricanes, as well as a rise in portable generator demand due to extreme weather [4]. - GNRC is focusing on increasing production rates for home standby generators, targeting 200millioninincrementalshipmentsin2024duetohurricaneimpacts[5].ProductInnovationsandMarketPosition−Ecobee′sgrowthinthesmartthermostatmarketandtheintroductionofthePWRcell2SeriesareexpectedtocontributepositivelytoGNRC′srevenueintheupcomingquarter[6].−Thelaunchofanew28kWhomestandbygeneratormodelenhancesGNRC′sproductofferings,providingacomprehensivehomeenergysolution[13].MarginandRevenueOutlook−Thegrossmarginfor2024isprojectedtoimproveby450basispointscomparedto2023,withfreecashflowexpectedtoreach200 million in incremental shipments in 2024 due to hurricane impacts [5]. Product Innovations and Market Position - Ecobee's growth in the smart thermostat market and the introduction of the PWRcell 2 Series are expected to contribute positively to GNRC's revenue in the upcoming quarter [6]. - The launch of a new 28kW home standby generator model enhances GNRC's product offerings, providing a comprehensive home energy solution [13]. Margin and Revenue Outlook - The gross margin for 2024 is projected to improve by 450 basis points compared to 2023, with free cash flow expected to reach 500 million [10]. - Generac has raised its revenue outlook for 2024, now expecting a 5-9% increase, with residential revenues anticipated to grow in the high-teens percentage range [8]. Challenges and Concerns - Weakness in Commercial & Industrial (C&I) sales is a concern, with expectations of C&I product sales being approximately 50millionbelowpreviousforecasts[11].−TheZacksConsensusEstimateforResidentialproducts′revenuesis50 million below previous forecasts [11]. - The Zacks Consensus Estimate for Residential products' revenues is 771 million, up 32.9% year-over-year, while C&I products' revenues are expected to decline by 6.1% year-over-year [12].