Generac Lands Amazon Data Center Deal Worth Up to $8 Billion
Generac Holdings (GNRC) has secured a significant long-term supply agreement with Amazon for data center backup generators. The deal, announced on September 16, is valued at $2.4 billion and could reach up to $8 billion in total. This contract positions Generac as a key supplier for data center applications, marking the company's second hyperscaler customer after this recent development.
UBS has reiterated its Buy rating and $340 price target on GNRC stock following the announcement. The investment firm notes that the stock is undervalued relative to its Fair Value, with shares currently trading at $198.05. Generac's data center business has shown significant growth, with a backlog of $1.6 billion as of Q2 2026, up from just $150 million in contracted orders for data center products one year ago.
UBS reduced its 2027-2028 residential sales growth forecast to 5% and legacy commercial and industrial growth to 6%, citing higher interest rates as a likely factor. However, the firm increased its 2028 adjusted EBITDA estimate by $24 million, with a positive impact from the data center product line offsetting lower demand in other areas.