William Blair maintains Outperform on GE Vernova shares

On Wednesday, William Blair analysts maintained their Outperform rating on GE Vernova (NYSE:GEV), citing the stock’s attractive entry point after a recent valuation adjustment. With a current market capitalization of $97.89 billion, GE Vernova’s stock now trades at 19 times enterprise value to earnings before interest, taxes, depreciation, and amortization (EV/EBITDA) based on the firm’s 2026 estimates. This is a decrease from the previous week’s multiple of 24 times, bringing it closer to the peer group average of 16 times. According to InvestingPro data, the company’s current EV/EBITDA multiple stands at 40.65x.

Analysts pointed out that the primary concern among clients regarding GE Vernova has been its valuation multiple and a sentiment that they may have missed the stock’s earlier gains. The stock has indeed shown remarkable performance, with InvestingPro data showing a 170.77% return over the past year, despite a recent 16.85% decline over the last week. The firm emphasized that the only change in the company’s status is the multiple itself. This recalibration presents an opportunity for investors who felt the stock had become too expensive, though InvestingPro’s Fair Value analysis suggests the stock remains slightly overvalued.

GE Vernova is recognized for its leadership in essential technologies that are expected to drive domestic energy production and meet electricity demands, particularly in areas that align with policies from the Trump administration. These technologies are crucial for powering artificial intelligence applications and supporting the reshoring of industries. For deeper insights into GE Vernova’s financial health and growth prospects, investors can access comprehensive analysis and 13 additional ProTips through InvestingPro’s detailed research reports.

The analyst’s commentary highlighted a common misunderstanding of GE Vernova’s DeepSeek technology and the power demand landscape, suggesting that this has led to a more favorable stock price for potential investors. Despite the recent decrease in the valuation multiple, William Blair remains confident in GE Vernova’s prospects and has reiterated their positive stance on the stock, with the company maintaining strong fundamentals including a healthy current ratio of 1.08 and positive earnings forecasts for the upcoming year.

In other recent news, GE Vernova has been making significant strides in the energy sector. The company has recently collaborated with Engine No. 1 and Chevron (NYSE:CVX) to construct up to 4GW of natural gas generation facilities, which will be co-located with data centers. This venture is expected to make use of GE Vernova’s advanced turbine technology, providing a scalable solution for energy needs.

In addition, GE Vernova’s fourth-quarter earnings aligned with expectations, and the company reaffirmed its fiscal year 2025 guidance, projecting to generate approximately $14 billion in cumulative free cash flow from 2025 to 2028. 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%.

Analysts from TD Cowen, Truist Securities, and BMO Capital Markets have adjusted their price targets for the company, reflecting confidence in GE Vernova’s long-term prospects. Despite recent market turbulence caused by the unveiling of a new AI model by DeepSeek, these analysts maintain a positive outlook, suggesting the company’s strong financial performance.

Truist Securities has reaffirmed its Buy rating for GE Vernova, with a price target of $470. BMO Capital Markets and Barclays (LON:BARC) have also increased their price targets to $471 and $487 respectively, indicating a positive outlook for the company’s future in the energy sector.

These are the recent developments surrounding GE Vernova, reflecting the company’s ongoing efforts to solidify its position in the energy sector.

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