Generac Holdings Inc. (GNRC) stock analysis

P/E above its 5-year median

Generac's P/E of 44.6 is above its own 5-year median of 34.9.

P/E above the industry

Generac's P/E of 44.6 is above the Electronic and Other Electrical Equipment and Components, except Computer Equipment median of 31.4.

EV/EBITDA above its 5-year median

Generac's EV/EBITDA of 29.5 is above its 5-year median of 17.4.

P/B below the industry

Generac's price-to-book of 3.98 is below the Electronic and Other Electrical Equipment and Components, except Computer Equipment median of 6.03.

Trading above fair value

The share price of $194.00 is above our fair value estimate of $131.91.

Margin of safety under 20%

The price is 47.1% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew -2.7% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew -20.8% a year over the last three fiscal years.

Earnings growth not accelerating

Net income grew -26.0% over the last twelve months, against a 5-year average of -14.6% a year.

Growing slower than the industry

Revenue grew 0.6% over the last twelve months; the Electronic and Other Electrical Equipment and Components, except Computer Equipment median is 13.5%.

Guidance raised

Generac raised its full-year 2026 net income margin, before deducting for non-controlling interests outlook on Jul 29, 2026.

Gross margin slipping

Gross margin was 39.5% over the last twelve months, against 39.9% a year earlier.

Return on equity under 15%

Return on equity was 9.5% over the last twelve months and averaged 15.4% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was 8.5%, below the 10% that usually covers the cost of capital.

Return on equity below the industry

Generac's return on equity of 9.5% is below the Electronic and Other Electrical Equipment and Components, except Computer Equipment median of 12.0%.

Earnings shrank over 5 years

Net income shrank 14.6% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 5.8% over the last twelve months, against a 5-year average of 8.0%.

Net margin below the industry

Generac's net margin of 5.8% is below the Electronic and Other Electrical Equipment and Components, except Computer Equipment median of 5.8%.

High debt

Debt is 43.8% of shareholders' equity, above the 40% we consider low.

Debt falling against equity

Debt to equity fell from 63.5% five years ago to 43.8%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 43.5% of total debt.

Interest well covered

Operating income covers interest expense 6.2 times.

Short-term assets cover short-term debts

Current assets are 2.04 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 4.42; above 3 is the safe zone and below 1.8 the distress zone.

No dividend

Generac has not paid a dividend in the last twelve months.

Yield against Treasuries

No dividend.

Yield against the market

No dividend.

Dividend stability

No dividend.

Earnings cover

No dividend.

Cash-flow cover

No dividend.