Oklo stock tumbles as Financial Times scrutinizes valuation
On Friday, Mizuho (NYSE:MFG) Securities adjusted its outlook on GE Vernova (NYSE: GEV), increasing the price target to $385 from $375, while sustaining an Outperform rating on the company’s stock. The revision follows GE Vernova’s first-quarter financial performance and a conservative fiscal year guidance that surpassed initial expectations despite a significant margin impact from import tariffs. The company, now valued at $98.4 billion, has demonstrated remarkable momentum with an 11.4% return in the past week alone. InvestingPro data reveals 12 key insights about GEV’s performance and valuation metrics, available to subscribers.
Mizuho’s analyst highlighted the challenges GE Vernova is facing due to the tariffs, especially in the offshore wind sector, where adapting the supply chain is more complex compared to the gas and electrification sectors that can more readily employ dual sourcing strategies. Despite these challenges, the company reported a solid 50 gigawatts in gas turbine orders, with 22 gigawatts detailed in the firm’s research note. The company maintains a strong financial position with more cash than debt on its balance sheet, though it trades at a relatively high earnings multiple of 48.5x.
The decision to raise the price target is attributed to a reduced share count resulting from a $1.2 billion buyback executed in the first quarter. Mizuho also updated its financial model for GE Vernova to account for seasonal fluctuations, the timing of wind project completions, and an increased tariff impact, now estimated at approximately 100 basis points to EBITDA for the fiscal year 2025, compared to the previously estimated 50 basis points.
The analyst reaffirmed the Outperform rating, citing the company’s potential for capacity expansion in the coming year, its conservative guidance, strong cash position, and the ongoing share buyback program as key factors supporting the positive outlook on GE Vernova’s stock.
In other recent news, GE Vernova reported impressive first-quarter 2025 financial results, surpassing market expectations. The company achieved an earnings per share of $0.91, significantly higher than the forecasted $0.63, and revenue increased by 15% year-over-year to $10.2 billion. JPMorgan responded by raising its price target for GE Vernova to $430, maintaining an Overweight rating, due to strong performance in the Power and Electrification segments. The firm cited robust order intake and favorable pricing trends as key factors in this decision. Additionally, GE Vernova confirmed its 2025 fiscal guidance, accounting for a $300-400 million impact from tariffs.
The company also demonstrated substantial capital return actions, executing $1.2 billion in share buybacks in the first quarter and an additional $300 million in April. GE Vernova initiated its first dividend, distributing approximately $70 million to shareholders. The company’s backlog includes around 29 gigawatts of gas power equipment, with an additional 21 gigawatts in slot reservations, indicating sustained demand. Revenue guidance for the full year remains at $36-$37 billion, with a free cash flow projection of $2-$2.5 billion, reflecting confidence in continued growth.
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