Hello my dears,

As announced yesterday, I will be introducing you to a few companies on the subject of electricity, energy and everything associated with it over the next few days. 🔌

I think the importance of these companies in the future, due to the growing demand for electricity and energy, should be clear to everyone by now.

There have already been some great posts about this in the past. Among others from our dear @EpsEra . (best wishes, and I hope you are well)

We are happy to discuss the topic and today's company in the comments.

Your opinion is important to me!

As Juan is still in Brazil, I will introduce Generac to you today. Nevertheless, as usual, here is the Juan's conclusion.

🏭 $GNRC (+0,94%)

Generac dominates the market for emergency power systems with a US market share of over 70 %. Adjusted earnings per share of USD 1.80 were reported on April 29, exceeding the previous year's figure by 43 %. Sales increased by 12% year-on-year to USD 1.06 billion. As a result, management raised the outlook for revenue growth in 2026. The company not only supplies generators, but is increasingly integrating solar storage and energy management software. In view of outdated power grids and frequent blackouts, private crisis preparedness is becoming increasingly important.

Generac [GNRC | WKN A0YGR4 | ISIN US3687361044] is a leading provider of emergency power generators and backup power systems. The product range is aimed at private households, commercial enterprises, industrial plants and huge data centers. The core task of all these systems is to ensure a reliable and uninterruptible power supply precisely when the public power grid is overloaded or breaks down completely due to extreme weather events.

While the company has become known to investors in recent years as the US market leader for private emergency power solutions for private homes, Generac is currently undergoing a significant strategic change. Under CEO Aaron P. Jagdfeld, the company is transforming itself from a pure hardware manufacturer to an integral player in the decentralized energy transition.

The management's overarching vision is to build a decentralized energy grid that seamlessly networks conventional generators, modern battery storage systems and smart energy management systems. The company currently has a market capitalization of USD 13 billion.

The biggest drivers for Generac's core business are the accumulation of extreme weather events and the ageing of the US power grid. Last year alone, power outages in the USA amounted to over 1.5 billion hours. Added to this are rising energy costs. Generac not only wants to provide backup systems for more independence from the ailing power grids, but also enable a transparent and efficient supply via intelligent energy management. Every major power outage is free advertising and drives demand.

The market penetration of emergency power generators in the USA currently stands at 6.75%. In its latest investor presentation, Generac points out that every further 1% increase in the penetration rate corresponds to an additional market volume of around USD 4.5 billion.

The company is also increasingly benefiting from the gigantic appetite for energy in artificial intelligence. AI data centers are absolutely dependent on absolute reliability. As a result, the commercial and industrial (C&I) business is becoming a major growth driver for Generac. In the 4th quarter, the figures for which were published on February 10, the company recorded a 9% increase in revenue in the C&I segment to USD 358 million. Over the year as a whole, global C&I product sales even grew by 10 %.

There is currently already around 35 gigawatts of diesel backup capacity in the USA, installed at locations such as huge retail chains ("big box stores"), industrial plants and, above all, data centers - this is comparable to the output of 35 nuclear power plants. Although demand from the telecommunications sector has recently been rather weak due to a lack of extreme power outages, the high energy consumption of AI data centers easily makes up for this.

Generac was founded in 1959.

Net sales break down by product family as follows:

- Equipment for the private sector (53.9%): Emergency, portable and motorized generators powered by natural gas, propane or fuel, switchgear, etc.;

- Industrial and commercial equipment (34.6%): stationary, containerized, industrial and emergency generators powered by natural gas, propane, fuel, etc., advanced energy control systems and software platforms, switchgear, modular power systems, etc..;

- Other (11.5%).

The United States accounts for 82.5% of net sales.

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Juan summary of key financial figures (Generac 2025-2028)

Okay, here's the crisp Juan summary - just the way you like it:

Generac really ramps up again from 2026. 2025 is clearly a transition year with pressure on sales, EBIT and profit - but from 2026, profitability picks up massively. The EBIT margin practically doubles, free cash flow increases by double digits every year and net debt is consistently reduced, even to net cash by 2028. net cash turns into net cash.

Quality trend: Margins up, ROE up, debt down - exactly the kind of turnaround momentum that is often underestimated later. EPS jump: Earnings per share explode from 2026, which should ease the valuation significantly.

In a nutshell: 2025 is the trough - 2026-2028 are the steep slopes to the top. Generac becomes a cash machine setup again.

Market value 15,703

Number of shares (in thousands) 58,869

Date of publication 11,02,2026

Juan's conclusion on the valuation ratios (Generac 2025-2028)

"Generac looks like a comeback case in slow motion: The P/E ratio is falling noticeably year after year, while the FCF yield is slowly but steadily increasing. PEG turns healthy from 2027 - this is the first real quality signal. Dividend remains zero, so everything must come from growth and margins. Overall: Valuation side is clearly improving, but the market wants to see evidence first."

Performance

1 week +5.71 %

1 month +39.59 %

6 months +71.78 %

1 year +129.86 %

3 years +133.62 %

Please wait for a correction here!

PRICE: €228.85 08.05.2026 at 22:00

$GNRC (+0,94%)