What Happened?
Shares of power generation products company Generac (NYSE: GNRC) jumped 2.5% in the afternoon session after the company posted strong second-quarter results, highlighting significant demand from data center customers.
The power equipment specialist reported Q2 revenue of $1.17 billion and earnings per share of $2.44. A key driver was its commercial and industrial sales, which reached $556 million, supported by demand from telecom and equipment rentals. Data center customers were a major contributor, accounting for more than $100 million in revenue.
Looking ahead, the company has a $1.6 billion backlog linked to data centers and secured roughly $1 billion in new orders in the previous 90 days, signaling continued growth.
The shares were trading at $197.57, up 2.9% from the previous close.
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What Is The Market Telling Us
Generac’s shares are very volatile and have had 23 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 3 months ago when the stock gained 15.8% on the news that it reported first-quarter 2026 results that handily beat Wall Street's expectations. The company posted revenue of $1.06 billion, up 12.4% year over year, and an adjusted profit of $1.80 per share, which was over 35% above analyst consensus. Profitability metrics also showed significant improvement, with adjusted EBITDA of $193.6 million far exceeding estimates of $160.1 million. Furthermore, Generac's operating margin expanded to 11.1% from 8.9% in the same quarter last year, and its free cash flow margin jumped to 8.5% from 2.9%, signaling enhanced operational efficiency and cash generation. These strong results prompted a positive investor response, driving the stock higher.
Generac is up 40% since the beginning of the year, but at $197.57 per share, it is still trading 32.5% below its 52-week high of $292.81 from June 2026. Despite the year-to-date gain, investors who bought $1,000 worth of Generac’s shares 5 years ago would now be looking at only $493.93.
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