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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.