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GE Vernova is a newly spun-off energy juggernaut poised to benefit from global electrification and grid modernization. While legacy profitability has been poor, significant operating leverage exists as it aligns with industry margins. Fair value range: low $533, high $902, with mid-point at $715.
Stock analysis

GEV fair value $533–$902

By StockMarketAgent.AI team· supervised by
Analyzed: 2026-05-08Next update: 2026-08-08Methodology v2.5Review: automatedArchetype: Mature compounder
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Last price
$1040.15
▼ -325.10 (-31.26%)
Fair value
$715
$533–$902
Rating
Sell
confidence 84/100
Upside
-31.3%
upside to fair value
Margin of Safety
$607.79
MoS level · 15%
Market Cap
$279.5B
P/E fwd 42.5

§1 Executive summary

  • Composite fair value $715 with high case $902.
  • Implied downside of 31.3% to fair value.
  • Moat 6.5/10 · confidence 84/100 · Mature compounder.
  • Currently screens above fair value, so patience matters more than entry speed.
Fair value
$715
Margin of safety
-45.5%
Confidence
84/100
Moat
6.5/10

Educational research only - not investment advice, an offer, or a trade instruction. Confirm current data and do your own due diligence before acting.

$1,040.15Price
Low $533.43
Mid $715.05
High $902.24

GE Vernova is a newly spun-off energy juggernaut poised to benefit from global electrification and grid modernization. While legacy profitability has been poor, significant operating leverageLeverageThe proportion of debt in the company's capital structure. Commonly measured as Debt/EBITDA, Debt/Equity, or Net Debt/EBITDA. exists as it aligns with industry margins.

  • Cycle upside
    Global electrification and grid modernization supercycle drives a multi-year backlog and robust top-line growth.

§2 Bear case

A stress test capping margins at 8% and terminal growthTerminal growthThe perpetual growth rate assumed in the Gordon-growth terminal-value calculation. Capped below long-run nominal GDP (typically 2.5–3.0% for developed-market firms). at 5% destroys the upside thesis, pulling fair valueFair valueOur composite estimate of intrinsic per-share value, blended across DCF, exit-multiple, and reverse-DCF methods. Reported as a low/mid/high range to capture model uncertainty. below $500.

Ways this thesis can break

Wind Segment Collapse

· Medium

Continued structural losses in the Wind segment overwhelm Power profitability, preventing group-level margin expansion past mid-single digits.

FV impact
-30%
Trigger
12-24 months

Electrification Margin Stagnation

· Low

Supply chain inflation and legacy contract drags stall the expected margin expansion in the Electrification segment, capping margins.

FV impact
-20%
Trigger
12-18 months

Valuation Multiple Compression

· High

Market shifts focus from the supercycle growth narrative to current-state cash flows, causing multiple compression from implied >13% growth rates.

FV impact
-40%
Trigger
6-12 months
Early-warning signals to monitor
MetricCurrentTrigger threshold
Failure to expand quarterly operating margins sequentially.MonitorDeterioration versus the report thesis
Continued elevated losses and negative margins in the Wind segment.MonitorDeterioration versus the report thesis
Slower than expected conversion of electrification backlog.MonitorDeterioration versus the report thesis
Downward revisions to internal valuation cross-checks revenue growth estimates.MonitorDeterioration versus the report thesis
Capex outstripping revenue growth without corresponding margin uplift.MonitorDeterioration versus the report thesis

§3 Financial history

Income statement — last six periods
Line itemT−0T−1T−2T−3T−4CAGR
Period2021-12-312022-12-312023-12-312024-12-312025-12-31Trend
Revenue—$29.65B$33.24B$34.94B$38.07B+6.4%
Gross profit—$3.46B$4.82B$6.09B$7.54B+21.5%
Operating income—$-2.88B$-923.0M$471.0M$1.39B—
Net income—$-2.74B$-438.0M$1.55B$4.88B—
EPS (diluted)$-2.33$-10.06$-1.60$5.58$17.69—
EBITDA—$-526.0M$932.0M$1.64B$2.24B—
R&D—$979.0M$896.0M$982.0M$1.20B+5.2%
SG&A—$5.36B$4.85B$4.63B$4.95B-2.0%

Quality scores

Piotroski F-score
7 / 9
0–9 quality composite
Altman Z-score
4.12
Bankruptcy risk (>3 safe)
Beneish M-score
-2.25
Earnings manipulation risk
OCF / Net income
1.02×
>1 indicates high earnings quality
Accounting quality gate
Pass
Sector-adjusted gate
ROIC
8.9%
Return on invested capital
§3

Numbers analysis

Cash flow

Cash-flow quality is reflected in the OCFOperating cash flowCash generated from the company's core operations after working-capital changes but before capital expenditures. The first line of the cash-flow statement. / net incomeNet IncomeNet Income is an income-statement line item used to reconcile revenue to operating profit, pre-tax income, net income, or per-share earnings. It should be compared across periods and against peer disclosure conventions., accounting-quality, and ROICROICReturn on invested capital. Operating profit (after tax) divided by invested capital. The single best gauge of capital-efficiency. Spread over WACC = economic value created. rows above.

Capital allocation

Capital allocation should be evaluated against reinvestment needs, balance-sheet strength, and shareholder returns.

Individual subscribers — §4 onwards11 more sections

Read the full analysis — 11 more sections.

Competitive moat, industry cycle, peer comparison, intrinsic valuation, sensitivity, scenarios, earnings decision tree, position management, investor perspectives, scorecard, and final recommendation.

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INTRINSIC VALUE FAQ

GEV intrinsic value questions

  1. GEV (GEV)'s intrinsic value is triangulated from discounted earnings at two cost-of-equity levels (strict CAPM with raw beta, moderate with adjusted beta), with owner earnings used as a floor for high-growth names.

FAQ

GEV — frequently asked questions

  1. Based on our latest analysis, GEV looks meaningfully overvalued. The current price is $1040 versus a composite fair-value midpoint of $715 (range $533–$902), which implies roughly 31.3% downside to the midpoint.

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