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Generac (GNRC) to Report Q2 Earnings: What's in the Cards?

Generac Holdings Inc. GNRC is scheduled to report second-quarter 2021 results on Jul 28, before the opening bell. In the last reported quarter, the company delivered an earnings surprise of 25.3%. It pulled off a trailing four-quarter earnings surprise of 26.1%, on average.

The Waukesha, WI-based company is expected to have recorded higher revenues on a year-over-year basis. Solid demand for home standby generators and PWRcell energy storage systems is a significant tailwind. With businesses picking up pace post the COVID-19 lockdown, favorable sales mix from higher shipments of Commercial & Industrial products across several markets and geographies might have driven Generac’s momentum globally.

Key Factors

During the quarter under review, Generac acquired a global manufacturer of generator controllers, Deep Sea Electronics Limited, for an undisclosed amount. The transaction, which was closed on Jun 1, reinforces Generac’s engineering and control capabilities which will support product innovation to meet the needs of customers.

Deep Sea Electronics’ prowess will enhance Generac’s focus on natural gas power generation and is expected to help it foray into microgrid applications. The buyout will help Generac advance its product roadmap while it continues to participate in the ongoing evolution of the world’s electrical grid. It will expand Generac’s internal capacity in the field of Controls and Automation, and accelerate its growth into the distributed energy resource and microgrid market. This is likely to be positively reflected in the upcoming results.

Strong operational execution and broad-based growth due to robust demand for residential products, supported by a resilient business model are expected to have boosted this Fortune 1000 manufacturing company’s margins. Effective acquisition strategies to monetize an ecosystem of devices that are related to energy use, storage, generation, control and optimization are expected to have enabled Generac to leverage key mega trends and expand its addressable markets while driving shareholder value.

Also, an extended footprint in the clean energy market, certain restructuring initiatives along with a healthy liquidity position might have bolstered its core sales growth in the to-be-reported quarter.

For the June quarter, the Zacks Consensus Estimate for total revenues is pegged at $872 million, which indicates an increase of 59.4% from the year-ago quarter’s reported figure. The consensus estimate for adjusted earnings per share is pegged at $2.35, which suggests a surge of 67.9%.

What Our Model Says

Our proven model predicts an earnings beat for Generac this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is perfectly the case here.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: Generac’s Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is +4.36% as the former is pegged at $2.46 and the latter at $2.35.

Generac Holdings Inc. Price and EPS Surprise

Generac Holdings Inc. Price and EPS Surprise

Generac Holdings Inc. price-eps-surprise | Generac Holdings Inc. Quote

Zacks Rank: Generac currently has a Zacks Rank #3.

Other Stocks to Consider

Here are some other companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this quarter:

Penske Automotive Group, Inc. PAG is slated to release second-quarter 2021 results on Jul 28. It has an Earnings ESP of +53.06% and currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Cincinnati Financial Corporation CINF is scheduled to release second-quarter 2021 results on Jul 28. The company has an Earnings ESP of +10.98% and sports a Zacks Rank #1, at present.

Antero Resources Corporation AR has an Earnings ESP of +44.02% and a Zacks Rank of 2. The company is set to report second-quarter 2021 results on Jul 28.


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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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