GE Vernova (GEV) Stock Slides, but Jefferies Sees Long-Term AI Power Upside

Core Viewpoint - GE Vernova Inc. (NYSE:GEV) has been upgraded to "Buy" by Jefferies analyst Julien Dumoulin-Smith, with a price target increase from $736 to $815, driven by stronger gas pricing and long-term services margin visibility, which supports management's confidence in AI-driven power demand [1][2]. Group 1: Stock Performance and Market Sentiment - GEV's shares have declined approximately 15% since the December 9th Analyst Day, primarily due to broader macro concerns related to data centers and AI, which may overlook the resilience of GEV's contracted services business [2]. - The recent pullback in GEV's stock price is viewed as an opportunity to 'buy the dip', as long-term gas service contracts extend well into the 2030s, providing stability [3]. Group 2: Pricing and Margins - Gas turbine pricing has shown positive surprises, and the services segment offers visibility extending deeper into the 2030s, which is expected to offset any weaknesses in gas equipment [4]. - GEV's new gas long-term service agreements (LTSA) boast a unique margin of approximately 40%, contributing significantly to incremental EBITDA expansion projected from 2025 to 2035 [4].