BMO Raises GE Vernova (GEV) PT, Keeps Outperform Rating
The firm's updated analysis focused on the company's Gas Power business. BMO Capital analysts highlighted strong, contracted earnings growth beyond 2030. This growth is expected to be driven by long-term service agreements (LTSAs) in the gas power service segment.
A long convoy of trucks driving across miles of desert, carrying offshore energy services equipment.
BMO Capital expects that by 2035, GE Vernova Inc. (NYSE:GEV) will generate about 2.5 times the annual revenue from LTSAs compared to 2024 levels, with gross margins nearly 1000 basis points higher.
Additionally, BMO Capital noted that GE Vernova Inc. (NYSE:GEV) has surged 85% over the last three months and near-term valuation metrics may appear stretched at 28 times the firm's estimated 2026 EBITDA.
The firm pointed out that while investors recognize the current gas turbine equipment orders can boost earnings from 2028 onward, the market has not fully recognized the significant upside potential from gas power service LTSAs.
GE Vernova Inc. (NYSE:GEV) is an energy equipment manufacturing and services company.
While we acknowledge the potential of GEV as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
READ NEXT: 10 Best American Semiconductor Stocks to Buy Now and 11 Best Fintech Stocks to Buy Right Now.
Disclosure: None. This article is originally published at Insider Monkey.
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