GE Vernova Rockets After Investor Day: Why Bank Of America Sees More Room To Run

Core Viewpoint - GE Vernova Inc. has achieved record highs following a positive investor update, with significant increases in long-term financial targets and backlog growth [1] Financial Performance - Revenue guidance has been raised from $45 billion to $52 billion, with adjusted EBITDA margin guidance increasing from 14% to 20%, surpassing the 18.1% consensus [4] - Bank of America analyst Andrew Obin raised the price objective for GE Vernova from $720 to $804, indicating an accelerating long-term earnings trajectory [2] Backlog and Capacity Expansion - Total backlog is expected to grow to approximately $200 billion by 2028, up from $135.3 billion at the end of Q3 2025, with Power contributing at least $35 billion and Electrification backlog projected to double from $30.2 billion to about $60 billion [5] - GE Vernova plans to produce up to 100 heavy-duty gas turbines annually by 2028, increasing from a baseline of 15 GW in 2024, and is committing an additional $1 billion in capital expenditures to expand its electrification segment [6] Shareholder Returns - The quarterly dividend has been doubled to $0.50 per share, and the stock buyback program has been increased to $10 billion from $6 billion, with $6.7 billion remaining authorized [7] - Management has reiterated its commitment to returning one-third of free cash flow to shareholders, indicating strong capital discipline [8] Market Position and Future Outlook - Bank of America believes GE Vernova deserves a valuation premium due to expected earnings nearly tripling from 2025 to 2028 and margin expansion across Power and Electrification [9] - Key factors supporting this outlook include top-tier earnings growth, structural demand tailwinds in electrification and grid modernization, and strong backlog visibility [10]