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    Revisiting Generac (GNRC) Valuation After Weaker Q3 2025 Results and Lower Full‑Year Outlook

    Simply Wall St·12/22/2025 04:31:33
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    Generac Holdings (GNRC) just delivered a tougher than expected Q3 2025 report, with revenue slipping and earnings missing forecasts after an unusually calm outage season reduced residential generator demand and led the company to trim full year guidance.

    See our latest analysis for Generac Holdings.

    That softer outlook has already weighed on sentiment, with a 7 day share price return of minus 12.30 percent and a 90 day share price return of minus 16.69 percent dragging the stock to 138.94 dollars, even though its 3 year total shareholder return of 50.71 percent still hints at meaningful longer term compounding despite more recent pressure.

    If you are reassessing where growth and resilience might come from next, it could be worth exploring fast growing stocks with high insider ownership as a way to spot other compelling ideas beyond Generac.

    With the shares now trading well below analyst targets yet still up strongly over three years, investors may be wondering whether this is an unfairly punished quality compounder or a business where the market already sees limited growth ahead.

    Most Popular Narrative: 33.7% Undervalued

    With Generac Holdings trading at 138.94 dollars versus a narrative fair value near 210 dollars, the story hinges on sustained growth and margin rebuilding over several years.

    Structural improvements in gross margins, supported by favorable pricing realization, supply chain efficiencies, and cost control initiatives, are driving durable improvement in EBITDA margins (raised outlook to 18, 19%). As the energy technology segment's development costs subside and C&I revenue scales, margin expansion is likely to be sustainable through 2026 and beyond.

    Read the complete narrative.

    Curious how margin expansion, double digit earnings growth and a lower future earnings multiple can still justify a higher value than today? The full narrative lays out the math.

    Result: Fair Value of $209.59 (UNDERVALUED)

    Have a read of the narrative in full and understand what's behind the forecasts.

    However, softer residential solar demand and dependence on unpredictable outage activity could undercut the margin recovery story and challenge those upbeat long term assumptions.

    Find out about the key risks to this Generac Holdings narrative.

    Build Your Own Generac Holdings Narrative

    If you want to stress test these assumptions or prefer to rely on your own work, you can build a personalized view in just minutes: Do it your way.

    A good starting point is our analysis highlighting 4 key rewards investors are optimistic about regarding Generac Holdings.

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.