SerpApi.Org
GE Vernova earnings for the second quarter fell short early Wednesday while revenue topped. In premarket trade, GE Vernova stock plunged before the open, away from buy points and back below key support.
GE VernovaGEV confirmed in June that its massive, heavy-duty gas turbines are basically sold out through 2029. Big Tech companies aggressively purchased the gas turbines to power their artificial-intelligence (AI) data-center campuses by themselves, with regionals grids unable to meet massive electricity demand.
GE Vernova Earnings
GE Vernova earned $2.47 a share in Q2, up 43% vs. a year earlier but far below views for $3.18. Revenue grew 22% to $11.1 billion, the third straight quarter of accelerating sales growth and modestly beating FactSet consensus of $10.79 billion.
Vernova now expects full-year sales of $45.5 billion-$45.6 billion and EBITDA of $6 billion. It had seen sales of $45 billion and EBITDA of $5.9 billion.
Orders were $24.2 billion, up 88% vs. a year earlier and up fro $18.3 billion in Q1.
Backlog grew by $13 billion vs. Q1. Analysts had expected backlog to climb 30% vs. a year earlier to more than $167 billion from Q1's $163 billion.
integration of Prolec, a new transformer acquisition, as well as Prolec's backlog contribution, are also under watch.
GEV Stock Plunges
Shares of GE Vernova fell more than 8% in early Wednesday stock market trading, signaling a move back below their 50-day line. On Tuesday, shares gave up solid gains to end fractionally lower, at 1,079.03.
GEV stock failed a recent breakout attempt but has bounced off the 50-day line. A move above the July 6 high at 1,195.94 would offer a buy point, the MarketSurge chart shows.
Also, aggressive traders could have used Monday's move above the 21-day moving average, and a short trendline, as an early entry. But that was risky with earnings due on Wednesday.
An 88 RS Rating, out of a best-possible 99, points to GEV stock's outperformance over the past year. The huge AI winner soared 93% over this period.
Get IBD's Daily Newsletter At Investors.com
More Room For Huge AI Winner To Run?
GE Vernova's rivals in the gas-turbine market include Siemens EnergySMERY. Challengers in the transformer market include EatonETN. Besides AI data centers, their products enjoy higher demand from bitcoin mining and grid modernization.
Ahead of Vernova earnings, Deutsche Bank analysts on Friday hiked their price target to $1,309, among the highest on Wall Street. The firm reportedly cited multiyear pricing power in a supply-constrained market, as well as massive scaling of free cash flow.
On Monday, Guggenheim analysts maintained a $1,300 target on GEV stock. They highlighted the rotation out of software tech stocks and into the AI energy landscape.
YOU MAY ALSO LIKE:
Check Out IBD's New Exposure Levels To Help You Stay In Step With The Market Trend
Top Growth Stocks To Buy And Watch In Today's Stock Market And Dow Jones
Find The Best Long-Term Investments With IBD Long-Term Leaders
