Peet Serfontein & Khumbulani Kunene
We enter a long position with a target price of $202.00 and a stop-loss of $155.00.
Generac Holdings Inc. manufactures and distributes energy technology products focused primarily on power generation and related solutions for residential, commercial and industrial customers. The company's core business encompasses a broad portfolio of backup and standby power systems, including portable generators and associated equipment such as transfer switches and monitoring systems.
The group has expanded into energy storage, smart energy management devices and connected home solutions to support evolving customer needs for greater resilience and efficiency.
Technically, a price that remains in a developing inclining channel pattern signals a potential investment opportunity for the stock (see the black upsloping trendlines on the main chart). This pattern indicates that the price is consistently forming higher highs and higher lows within a well-defined upward range. This movement suggests that demand continues to absorb supply on pullbacks, with the lower boundary of the channel acting as dynamic support and the upper boundary guiding the pace of the advance, further supporting the bullish stance.
The Piotroski F-score also supports the bullish case. This scoring system ranging from zero to nine, assesses a company's financial strength based on profitability, leverage and liquidity and operating efficiency. A reading of nine for GNRC, reflects a sustained and broad-based improvement in the company's underlying financial health rather than a short-term anomaly.
Upside price momentum according to the Moving Average Convergence Divergence (MACD), and the recent upward trajectory of the on-balance volume (OBV) indicator, also supports our bullish view.
| Share Information | |
|---|---|
| Share Code | GNRC US |
| Industry | Capital Goods |
| Market Capital (USD) | 10 billion |
| One Year Total Return | 14.25% |
| Return Year-to-date | 24.99% |
| Current Price (USD) | 170.45 |
| 52 Week High (USD) | 203.25 |
| 52 Week Low (USD) | 99.50 |
| Financial Year End | December |
| The price is above its 200-day simple moving average (SMA) and its 200-week SMA which also supports a bull case for the stock, highlighting long-term structural demand. | |
| Consensus Expectations (Bloomberg) | ||||
|---|---|---|---|---|
| FY24 | FY25E | FY26E | FY27E | |
| Headline Earnings per Share (USD) | 7.27 | 6.52 | 8.06 | 9.71 |
| Growth (%) | -10.30 | 23.63 | 20.39 | |
| Dividend Per Share (USD) | 0.00 | 0.00 | 0.00 | 0.00 |
| Growth (%) | - | - | - | |
| Forward PE (times) | 26.14 | 21.14 | 17.56 | |
| Forward Dividend Yield (%) | 0.00 | 0.00 | 0.00 | |
| While the company is set to deliver a soft FY25 performance, this is expected to rebound quickly to solid double-digit earnings growth over the medium term. | ||||
Buy/Sell Rationale:
Technical Analysis:
Fundamental view:
| Share Name and Position | KO - Buy (Continue to hold) |
ARKK - Buy (Continue to hold) |
BKNG - Buy (Continue to hold) |
AXON - Buy (Continue to hold) |
|---|---|---|---|---|
| Entry | 71.24 | 78.22 | 5 195.76 | 620.52 |
| Current Price | 73.55 | 79.77 | 5 153.41 | 610.22 |
| Movement | +3.2% | +2.0% | -0.8% | -1.7% |
| Comment | An upward-sloping expected price path across some AI forecast horizons remains of interest. Crossed above its 200-day SMA. Upside momentum is supportive. Our profit target is $80.00, with a trailing stop at $69.00. | A developing broadening-bottom pattern in the price remains of interest. Remains above its 200-day SMA. Fading downside price momentum is supportive. Our profit target is $98.00 with a trailing stop-loss at $75.15. | A developing inclining channel pattern remains of interest. Remains below its 200-day SMA. Downside price momentum is a concern. Our profit target is $6 200.00 with a trailing stop-loss at $4 880.00. | The recent clustering of bullish weekly price swings remains of interest. Remains below its 200-day SMA. Upside price momentum is supportive. Our profit target is $729.00 with a trailing stop-loss at $584.00. |
| Time to exit | 21 April 2026 | 8 July 2026 | 13 February 2026 | 29 April 2026 |
FNB Stockbroking and Portfolio Management (Pty) Ltd, a subsidiary of FirstRand Bank Limited, an authorised Financial Services Provider and authorised user of the JSE limited (Reg no: 1996/011732/07). This Publication note is issued by FNB Stockbroking and Portfolio Management (Pty) Ltd for the information of clients only and should not be produced in whole or part without prior permission. Although FNB Stockbroking and Portfolio Management (Pty) Ltd is an Authorised Financial Services Provider, any opinions and/or analysis contained in this Publication are for informational purposes only and should not be considered advice, including but not limited to financial, legal or tax advice, or a recommendation to invest in any security or to adopt any investment strategy. The information contained herein has been obtained from sources/persons which we believe to be reliable but is not guaranteed for correctness, completeness or otherwise and we do not assume liability for loss arising from errors in the information or that may be suffered from using or relying on the information contained herein irrespective of whether there has been any negligence by us, our affiliates or any other employees of us, and whether such losses be direct or consequential. As market and economic conditions are subject to rapid change, any comments, opinions, and analysis is rendered as of the date of publishing and may change without notice. Such changes may have a material impact on the outcome of any investment. Securities involve a degree of risk and are volatile instruments. Past performance is not indicative of future performances. Securities or financial instruments mentioned in the Publication note may not be suitable for all investors and FNB Stockbroking and Portfolio Management (Pty) Ltd has bares no responsibility whatsoever arising from or as a consequence hereof. The material is not intended as a complete analysis of every material fact regarding any share, instrument, sector, region, market, country, investment, or strategy. The recipient of this Publication must make their own investment decision and is advised to contact his relationship manager for a personal financial analysis prior to making any investment decisions. Copyright 2018 by FNB Stockbroking and Portfolio Management (Pty) Ltd.
