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Generate Big Returns with Generac Holdings Inc. (GNRC)

There never seems to be a year without disaster striking in the United States. Whether its a hurricane, a flurry of tornadoes, floods, or anything else for that matter, Americans are left stranded in their dark homes. With Americans becoming more prepared, one of the top emergency preparedness needs is a generator. If you buy a generator in North America, there is a good chance it was made by Generac Holdings Inc. (NYSE:GNRC). Generac manufactures generators for residential, commercial, industrial, and construction use, and markets them in the United States and Canada. Generac has a generator capable of powering anything from a lamp to a 20 story building.

Generac Holdings Inc. (NYSE:GNRC)

Generators are not only for powering homes in times of outages. Commercial businesses such as grocery stores and banks must always have backup generators to prevent loss of product. Most importantly, hospitals must have numerous backup generators to keep all of their machinery running to continue saving the lives of those inside. These generators are much larger than the ones you can wheel out of a Home Depot, and are over 100,000 times more powerful.

Generac manufactures products that run on several different kinds of fuel. You can buy one that runs on natural gas, liquid propane, gasoline, diesel, or bio-fuels; if there is a fuel, you can probably find a generator to run on it. This is very important because gasoline supply tends to run out in areas affected by a natural disaster. Having a generator that uses a more abundant fuel is the safest bet.

With the damage done by Hurricane Sandy, Generac is in for a huge quarter. In order for the rebuilding to happen, power must be generated to run every aspect of the reconstruction. Power can still not be restored in many areas, so Generac’s generators are in high demand. If this weather were not bad enough, now we have Snowstorm Nemo blanketing the northeast. This means that on top of the area affected by Sandy, there will be an even larger number of generators needed to keep people alive.

As of Saturday, Feb. 9, there are 650,000 Americans in New England left without power. Power companies have announced that it will only take days to restore power instead of weeks, but the need for power is still there, and the only solution for the time being is a generator. Prior to the storm hitting, hardware stores increased their inventory of generators and still sold out within days. There were actually people who would buy up a few and sell them for double the cost. This is an extreme case of price gouging, but at least it shows how much people really needed them. Generac can hardly keep up with the demand, but this is a great problem for any company to have.

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