Generac Stock Surges as Analysts See Undervalued Opportunity

Generac Corp.'s (GNRC) stock is poised for its strongest week since May, driven by analysts' views on the company's undervalued status following a major supply deal with Amazon. According to Wells Fargo, the agreement could propel Generac's data center revenue above $3 billion by 2028.

Wells Fargo estimates that Amazon could award as much as $8 billion under the generator supply agreement, giving Generac close to half of Amazon's diesel-generator deployments. The firm maintains an 'Overweight' rating and a $280 price target on the shares, describing the current valuation multiple as 'far too low' after the agreement.

Roth Capital also raised its price target on Generac to $250 from $214 while keeping a Neutral rating. JPMorgan highlighted the contract's ability to provide greater visibility into future sales, estimating that spreading potential Amazon deliveries across fiscal 2027 and 2028 would give Generac about $1.9 billion in fiscal 2027 data center revenue visibility.