GE Vernova beats on profit with first standalone results, despite wind weakness
By Tomi Kilgore
Revenue rises, but less than expected as growth at Power and Electrification offset Wind's decline
Shares of GE Vernova Inc. got a nice boost in early trading Wednesday, after the power and renewable energy company reported second-quarter earnings that were well above expectations, while revenue missed amid weakness in the wind business.
The results were the first for the company since it completed its separation from GE Aerospace (GE) on April 2.
GE Vernova's stock (GEV) rallied 2.1% in premarket trading, to put it on track for a fourth straight gain.
The company swung to net income of $1.28 billion, or $4.65 a share, from a loss of $149 million, or 55 cents a share, in the same period a year ago. The FactSet consensus for net earnings per share was 84 cents.
Total revenue grew 1% to $8.204 billion, but was below the FactSet consensus of $8.259 billion.
Among the company's business segments, Power revenue rose 7.8% to $4.46 billion and Electrification revenue jumped 18.9% to $1.79 billion, but Wind revenue dropped 20.7% to $2.06 billion.
Orders increased 27% in Power to $4.98 billion, but fell 4% in Electrification to $4.82 billion and tumbled 44% in Wind to $2.16 billion.
The Wind business was hurt by the cancellation of a large offshore equipment order that was placed a year ago but canceled during the fourth quarter.
Power saw strength in gas power services and equipment, while Electrification witnessed strong demand for transformers, switchgears and circuit breakers.
Free cash flow was $821 million, compared with negative $447 million a year ago.
Looking ahead, the company said it expects revenue to trend toward the higher end of its guidance range of $34 billion to $35 billion, while the FactSet consensus is $34.58 billion.
The outlook for free cash flow was raised to $1.3 billion to $1.7 billion from $700 million to $1.1 billion.
The stock has run up 16.6% over the past three months through Tuesday, while the S&P 500 index has advanced 9.6%.
-Tomi Kilgore
This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
07-24-24 0726ET
Copyright (c) 2024 Dow Jones & Company, Inc.-
What’s the Difference Between the CPI and PCE Indexes?
-
Micron Earnings: Great Guidance but Stock Now Looks Fairly Valued
-
August PCE Report Forecasts Show More Good News on Inflation
-
AI Stocks May Be Down, but Don’t Count Them Out
-
4 Stocks to Buy as the Fed Cuts Interest Rates
-
Markets Brief: The Uncertain Path to Neutral Interest Rates
-
What’s Happening in the Markets This Week
-
Where Top Stock Fund Managers Are Looking Next After the Fed Rate Cut
-
Our Top Pick for Investing in US Renewable Energy
-
How to Measure a Stock’s Uncertainty
-
How to Determine Whether a Stock Is Cheap, Expensive, or Fairly Valued
-
Why a Company’s Management and Capital Allocation Matter
-
How to Determine What a Stock Is Worth
-
How to Measure a Company’s Competitive Advantage
-
How to Think Like a Stock Analyst
-
How GLP-1 Drugs Like Ozempic Are Boosting Biopharma Stocks