1. GE Vernova Inc. (NYSE:GEV)
Number of Hedge Fund Holders: 89
GE Vernova Inc. (NYSE:GEV) is a leading energy equipment manufacturing and services company that manufactures electrical equipment, natural gas turbines, hydropower turbines, and high-voltage electrical transmission products. The company’s products for renewable energy technologies include onshore and offshore wind turbines and solar power solutions. GE Vernova Inc.’s (NYSE:GEV) technology is utilized in roughly 55,000 wind turbines and 7,000 gas turbines spanning over 100 countries.
GE Vernova Inc. (NYSE:GEV) has announced a temporary halt on new offshore wind turbine projects due to unfavorable market conditions. The company plans to focus on executing its existing backlog of $3 billion which is expected to be completed within the next two years. While the offshore business faces challenges, the company is optimistic about the growth prospects of its onshore wind segment, which has seen significant increases in orders. To improve profitability, the company is implementing cost-saving measures and remixing its backlog. Management expects the onshore wind business to deliver high single-digit EBITDA margins on flat revenue this year, with potential for margin accretion as revenue grows as early as 2026.
GE Vernova Inc. (NYSE:GEV) is seeing significant growth in demand for grid-related investments to improve reliability and connect more zero-carbon power sources. The company’s Electrification segment is benefiting from this trend, with revenue growth of 24% in Q3. The company is also investing in its capacity to support the growing demand for electrification products, including high-voltage direct current (HVDC) systems, transformers, and switchgears, which are essential for connecting new generation sources to the grid. GE Vernova Inc. (NYSE:GEV) is also investing in its power conversion capabilities, which are critical for the integration of solar and wind energy into the grid.
In their Q3 investor letter Carillon Tower Advisers, an investment management company, said the following regarding GE Vernova Inc. (NYSE:GEV):
“GE Vernova Inc. (NYSE:GEV) is a global leader in the electric power industry that was recently spun out of a much larger industrial conglomerate. The company’s shares have performed well since, primarily as a result of power demand growth forecasts that continue to rise. We believe GE Vernova is distinctly positioned to capitalize on this attractive trend across its various products and services, but most notably within its large-scale gas turbine equipment and related services, as well as in its high-voltage electrical transmission products. The company is seeing a notable uptick in demand and is booking orders at profitability levels in excess of prior investor expectations.”
While we acknowledge the potential of GE Vernova Inc. (NYSE:GEV) to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than GEV but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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