GE Vernova Stock Slips After Jefferies Downgrade On Valuation Concerns, Retail Finds Buying Opportunity
Synopsis
Jefferies said that while GE's long-term fundamentals remain strong, the stock provides "narrowing incremental risk/reward" as the shares have outperformed in recent times.
GE Vernova (GEV) stock was down marginally in extended trading on Thursday after falling 2.9% in the regular trading session.
Jefferies downgraded the stock to ‘Hold’ from ‘Buy’ but lifted the price target to $527 from $427, according to TheFly. The new price target represented an upside of 8.7% compared to the stock’s previous closing price.
The power equipment producer’s stock has a consensus price target of $417.30, according to FinChat data.
According to TheFly, the brokerage noted that the present share price already reflects a premium based on Jefferies' higher-than-consensus 2028 estimates.
Jefferies said that while GE's long-term fundamentals remain strong, the stock provides "narrowing incremental risk/reward" as the shares have outperformed in recent times.
“It has been a great climb, but air gets rarer towards the top,” the brokerage said.
Earlier this month, JP Morgan already lowered estimates for GE Vernova’s onshore wind business amid policy uncertainty.
While GE Vernova’s power equipment sales have boomed, its sales in the wind segment have stagnated amid continued project delays and the Trump administration’s unfavorable policies.
CEO Scott Strazik said at a Bernstein conference on Wednesday that the company’s electrification business is on course to surpass its wind business in size and revenue by next year.
During Trump’s visit to the Middle East in May, GE Vernova signed a $14 billion agreement with Saudi Arabia to supply gas turbines and other energy solutions.
Retail sentiment on Stocktwits was in the ‘bullish’ (69/100) territory, while retail chatter was ‘extremely high.’
One retail trader described Thursday’s stock move as a healthy pullback.
“Think I'll take a starter position here,” another trader said.
GE Vernova stock has gained 41.6% year to date (YTD).
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