Generac Holdings, Inc. - Momentum
January 02 2012 - 7:00PM
Zacks
Generac Holdings, Inc. (GNRC) has been surging for the last
three months, recently hitting a new all-time high after almost
doubling since late September. With another strong quarter in hand
and a bullish growth projection, this Zacks #1 Rank stock is an
industrial take on momentum.
Company Description
Generac Holdings, Inc. designs, manufactures and
sells backup power generation products for residential,
light-commercial and industrial markets in the United States. The
company was founded in 1959 and has a market cap of $1.1
billion.
Generac might not seem like the most glamorous
company in the world, but when you take a look at its share price,
you might think otherwise. That movement has been driven by
impressive sales and earnings growth, last on display in early
November with strong Q3 results that came in ahead of
expectations.
Third-Quarter
Revenue for the period was up 49% from last year to
$239 million. Earnings also came in strong at 75 cents, 19% ahead
of the Zacks Consensus Estimate.
The great quarter was driven by gains in the
company's Residential segment, where sales jumped 61% from last
year. But commercial and industrial sales were also strong, up
27%.
Financial Profile
Generac has used its recent earnings momentum to
strengthen its financial profile, with cash and short-term
investments up $11 million from last year to $139 million while
total debt fell $98 million to $633 million.
Estimates
We've seen some real nice movement in estimates
over the last few months, with the current year up 16% to $2.01.
The next-year estimate is up 17% in the same time to $2.30, a
bullish 14% growth projection.
Valuation
But in spite of the gains, the valuation picture
still looks solid, with its PEG ratio of 1 directly in line with
the benchmark for value.
12-Month Chart
On the chart, shares have been rallying for the
last three months, recently hitting a new all-time high on the good
quarter. Look for support from the trend line on any weakness. Take
a look below.
![](http://www.zacks.com/images/upload_dir/1325270445.jpg)
Michael Vodicka is the Momentum Stock Strategist
for Zacks.com. He is also the Editor in charge of the
market-beating Zacks Whisper Trader Service.
GENERAC HOLDING (GNRC): Free Stock Analysis Report
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