Is GNRC a good stock to buy? We came across a bullish thesis on Generac Holdings Inc. on r/ValueInvesting by ValueEquities. In this article, we will summarize the bulls’ thesis on GNRC. Generac Holdings Inc.’s share was trading at $295.54 as of June 22nd. GNRC’s trailing and forward P/E were 92.36 and 34.36 respectively according to Yahoo Finance.
Generac Holdings Inc. designs, manufactures, and distributes energy technology products and solutions worldwide. GNRC is presented as a compelling value opportunity that stands to benefit from one of the largest infrastructure buildouts in decades. While much of the market remains focused on identifying the ultimate winners in artificial intelligence, the thesis argues that every major AI platform, cloud provider, and hyperscale data center shares a common dependency: reliable power.
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As electricity demand accelerates due to the rapid expansion of AI workloads, the limitations of the U.S. power grid are becoming increasingly apparent, creating a significant opportunity for companies that provide critical power infrastructure. Generac, historically viewed as a residential generator manufacturer, is increasingly transforming into an essential supplier of backup power systems for data centers and commercial customers. This shift is highlighted by the company’s recently announced supply agreement with a hyperscale data center operator, which could serve as an important catalyst for long-term growth as AI-related infrastructure spending continues to expand.
The company’s first-quarter 2026 results reinforced this bullish outlook. Revenue increased 12% year-over-year to $1.06 billion, while adjusted earnings per share reached $1.80, significantly exceeding consensus estimates of $1.33. Most notably, the commercial and industrial segment, where the data center opportunity resides, delivered 28% year-over-year growth.
Encouraged by strong execution, management raised its full-year outlook and now expects mid-to-high teens revenue growth while continuing to expand EBITDA margins toward 19%. Although residential demand remains a headwind, the accelerating growth of the commercial and industrial business is increasingly offsetting that weakness.
Looking further ahead, management’s plan through 2028 targets nearly 90% EBITDA growth from current levels, suggesting substantial upside if execution remains strong and AI-driven power demand continues to accelerate.
Previously, we covered a bullish thesis on Otis Worldwide Corporation (OTIS) by Brass Tacks Cap in October 2024, which highlighted the company’s dominant elevator service franchise, recurring revenue model, high customer retention, and modernization-driven growth. OTIS’s stock price has depreciated by approximately 29.88% since our coverage. ValueEquities shares a similar view but emphasizes Generac’s AI infrastructure opportunity, data center exposure, and accelerating commercial and industrial growth.
Generac Holdings Inc. is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 66 hedge fund portfolios held GNRC at the end of the first quarter which was 56 in the previous quarter. While we acknowledge the risk and potential of GNRC as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than GNRC and that has 10,000% upside potential, check out our report about this cheapest AI stock.
Disclosure: None.
