Generac ( NYSE: GNRC ) on Tuesday was downgraded to Neutral from Outperform by analysts at Baird. The said the maker of backup generators and solar equipment isn’t likely to see more demand until dealers of its products reduce their inventories.
“Though we like the current price point for long-term (three- to five-plus-year) holders, we would be patient with new capital,” Baird said in a Dec. 20 report. “We look to turn constructive again when visibility in bottoming HSB [home standby battery] demand emerges.”
Until there are clearer signs that the market for Generac’s ( GNRC ) products is recovering, investors aren’t likely to contemplate “what long-term earnings power can look like (most conversations right now are focused on downside scenarios and how bad earnings could be),” the report said.
Generac ( GNRC ) may see a turning point in mid-2023 at the earliest or possibly in the first half of 2024, according to Baird.
Generac ( GNRC ) fell 1.4% in premarket trading on Tuesday.
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Generac downgraded to Neutral at Baird on uncertain recovery