Shares of GE Vernova (GEV) surged in trading even as the company’s results fell short of Street estimates but its orders surged in Q4. The energy equipment company reported adjusted earnings of $1.73 per share, compared to earnings of $0.72 per share in the same period last year. This fell short of consensus estimates of $2.30 per share. It is important here to note that GE Vernova was spun off from its parent company, GE (GE) in April last year.
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Furthermore, the company’s revenues increased 5% year-over-year to $10.6 billion in the fourth quarter. This was below Street estimates of $10.7 billion.
GEV’s Total Orders Soar in Q4
In addition, GEV’s total orders rose 22% year-over-year on an organic basis to a record $13.37 billion in Q4, driven by a 118.2% surge in Electrification and a 20.2% increase in Power, offsetting a 41.2% drop in Wind orders. The decline in Wind orders was attributed to tough comparisons with a large U.S. onshore wind order in Q4 2023.
GEV Announces Dividend and Stock Buyback
Additionally, the company announced a quarterly dividend of $0.25 per share payable on January 28 to shareholders of record as of December 20, 2024. Furthermore, GEV’s Board of Directors announced an initial stock buyback of $6 billion during the fourth quarter with 8,000 shares repurchased in late December for around $3 million.
GEV Reiterates FY25 Guidance
Looking ahead, the company reiterated its FY25 guidance with revenues in the range of $36 billion to $37 billion with adjusted EBITDA margin likely to be in “high-single digits.” GEV expects its power equipment business to grow its organic revenues in the “mid-single digit” while its electrification segment could see its organic revenues rising in “mid-to-high-teens” in FY25. On the other hand, its wind equipment business is likely to see a decline in organic revenues in “mid-single digits.”
Is GEV a Buy or Sell?
Analysts remain bullish about GEV stock, with a Strong Buy consensus rating based on 16 Buys and two Holds. The average GEV price target of $385.25 implies a downside potential of 7.4% from current levels. These analyst ratings are likely to change following GEV’s results today.
