Generac Holdings (GNRC.N): Reflections Post 2Q; Strong Execution Amid Outage in Investor Interest

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Generac Holdings (GNRC.N): Reflections Post 2Q; Strong Execution Amid Outage in Investor Interest

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29 Jul 2026 22:20:47 ET │ 12 pages

Generac Holdings (GNRC.N)

Reflections Post 2Q; Strong Execution Amid Outage in Investor Interest

CITI'S TAKE

We caught up with GNRC after 2Q results. Our takeaways are: 1) datacenter

backlog includes ~$650mm from colocators for delivery in 2027, with this

segment booking ~$300mm in the past 90 days; 2) hyperscaler one could Neutral / High Risk

place orders for 2028 assuming good execution on 2027 deliveries, Price (29 Jul 26 16:00) US$195.19

especially as it operates on an annual commitment basis; 3) high MW

Target price US$300.00capacity should be ~$3.75B by the end of 3Q27; 4) DC EBITDA margins

should have upside from the current mid-teens YTD level given higher Expected share price return 53.7%

domestic mix and operating leverage; 5) GNRC sees its direct to customer Expected dividend yield 0.0%

sales channel as an advantage over distributor-led sales for high MW

Expected total return 53.7%generators; 6) HSBs growth Y/Y in 2Q was primarily price-driven as volume

growth was modest Y/Y; 7) the core consumer demographic remains Market Cap US$11,491M

resilient, with category demand continuing to be outage-driven; and 8) any

potential buybacks would be opportunistic and dependent on leverage,

capex, and WC.

Price Performance

Guidance Items — GNRC provides more detailed guidance and metrics on the (RIC: GNRC.N, BB: GNRC US)

conference call which we have summarized in Figure 1.

Estimate Changes — We have updated our model for 2Q results and latest guidance.

We believe GNRC delivered on most key items investors were looking for including:

1) finalized order from hyperscale one, 2) details on the size of order from hyperscaler