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Tuesday, Truist Securities reaffirmed its Buy rating and $470.00 price target for GE Vernova (NYSE:GEV), following a significant sell-off triggered by news from DeepSeek. The sell-off saw GEV shares plummet approximately 22%, contributing to a -20.67% decline over the past week. According to InvestingPro data, the stock is currently trading at $335.40, with analyst targets ranging from $265 to $500. Analysts at Truist Securities highlighted a new joint development between GE Vernova, Engine No. 1, and Chevron (NYSE:CVX), which holds a Hold rating from Dingmann. This collaboration aims to construct up to 4GW of natural gas generation facilities, to be co-located with data centers. GE Vernova, with its $34.94 billion in trailing twelve-month revenue and "Good" InvestingPro Financial Health score, appears well-positioned for this venture.
Under the terms of the partnership, Engine No. 1 and Chevron have secured reservations for seven of GEV’s 7HA natural gas turbines, estimated to deliver around 3GW of capacity based on the 7HA.03 model turbine. The agreement also includes provisions for the future integration of lower carbon solutions, such as carbon capture and storage (CCS).
Truist Securities expressed a positive outlook on the announcement, suggesting it demonstrates GE Vernova’s expanding and diversified customer base in the natural gas turbine market. The firm anticipates that GEV shares will perform strongly in the market today, bouncing back from the previous day’s sharp decline.
The joint venture is seen as a strategic move for GE Vernova, Engine No. 1, and Chevron to combine energy generation with technological infrastructure, which could meet the growing demand for energy in the data center industry. This initiative is expected to utilize GEV’s advanced turbine technology, offering a scalable solution for energy needs while retaining the option to adopt more sustainable practices in the future.
Truist’s reiterated Buy rating and price target suggest confidence in GE Vernova’s market position and the potential for the stock to recover and advance following the recent sell-off. The firm’s analysis indicates that the recent partnership and development plans could provide a solid foundation for GE Vernova’s future growth and performance in the energy sector. InvestingPro analysis reveals the stock trades at a P/E ratio of 76.54x, with analysts maintaining a positive outlook and forecasting profitability for the upcoming year. For deeper insights into GEV’s valuation and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
In other recent news, electrical equipment giant GE Vernova is in the spotlight as analysts from TD Cowen, Truist Securities, and BMO Capital Markets adjust their price targets for the company. TD Cowen raised the target to $405, while Truist Securities and BMO Capital Markets increased it to $470 and $471 respectively. These adjustments reflect confidence in the company’s long-term prospects, despite recent market turbulence triggered by the unveiling of a new AI model by DeepSeek.
The model’s potential for improved efficiency has sparked concerns about future electricity demand, impacting stocks across the power industry. However, GE Vernova’s strong financial performance, including a 220% return over the past year, suggests resilience in the face of these developments.
Despite these concerns, GE Vernova’s fourth-quarter earnings aligned with expectations, and the company reaffirmed its fiscal year 2025 guidance. It also plans to complete large offshore wind projects by 2026 and has revised its 2028 adjusted EBITDA margin target to 14%, up from the previous 10%. The company anticipates generating approximately $14 billion in cumulative free cash flow from 2025 to 2028. These are the recent developments surrounding GE Vernova.
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