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Key Takeaways
- Generac missed earnings estimates and full-year guidance as demand for its commercial products slowed.
- The maker of generators and other electric power items reported revenue at its commercial and industrial (C&I) unit was basically flat from a year ago.
- Generac said its C&I sales have been hurt by lower demand from certain telecom, rental, and “beyond standby” customers.
Generac Holdings (GNRC), the maker of generators and other electric power products, rerported earnings that missed analysts’ expectations and gave weaker-than-anticipated guidance as commercial demand softened.
The company posted fourth-quarter earnings per share of $2.07, short of estimates. Revenue was up 1% to 1.06 billion, basically in line with expectations.
Sales of residential products were up 1% to $580 million, while its commercial and industrial product sales of $363 million were just $2 million more than a year ago.
The company noted that cash flow from operations ($317 million) and free cash flow ($266 million) were both record highs.
Generac warned that 2024 full-year net sales growth will be in the 3% to 7% range, less than analysts had been looking for. The company anticipates an approximately 10% drop in commercial and industrial sales, “primarily due to weakness with certain direct telecom, rental, and ‘beyond standby’ customers.” It sees residential sales rising in the mid-teens percent range on higher demand for home standby generators and energy technology products.
Generac shares fell 0.5% Wednesday to close at $123.44, after falling as low as $112.34 early in the session. The stock is down about 9% over the past year.