GEV Stock Underperforms Industry in a Month: What Should Investors Do?

Core Insights - GE Vernova Inc. (GEV) shares have increased by 0.2% over the past month, underperforming the Zacks Alternate Energy – Other industry's growth of 9.2% [1][7] - The company is facing significant risks related to supply-chain disruptions, which include high costs and unavailability of necessary products, components, and raw materials [1][21] Challenges Faced by GEV - GE Vernova is experiencing difficulties due to global supply-chain issues affecting various industries, including its own [3] - The company relies on complex global supply networks for components in gas turbines, wind turbines, and grid infrastructure, purchasing nearly $20 billion in materials from over 100 countries [4] - Disruptions in raw material availability and logistical delays are impacting production timelines and increasing input costs, which could hurt profitability [4][21] Business Operations and Performance - GEV designs and delivers advanced industrial products and software-driven solutions for complex projects, including gas turbines, wind turbines, and nuclear power [5] - The company has approximately 57,000 wind turbine units with a total installed capacity exceeding 120 GW, capitalizing on the growing wind sector [9] - GEV's diversified business across Power, Wind, and Electrification allows it to offer a comprehensive suite of solutions, appealing to a broad customer base [10] Earnings Estimates and Financial Metrics - Earnings estimates for 2025 and 2026 have declined by 2.04% and 3.42%, respectively, over the past 60 days [7][11] - GEV has beaten earnings estimates in three of the last four quarters, with an average surprise of 38.03% [13] - The company's trailing 12-month return on equity is 13.23%, lower than the sector average of 15.07% [15] Valuation and Market Position - GEV is currently trading at a premium compared to its industry on a forward 12-month P/E basis [17] - Other alternative energy stocks, such as Crescent Energy Company and Talen Energy, are trading at a discount compared to the industry's P/E [19]