The data center boom and need for backup generators should push shares of Generac higher, according to Jefferies. Analyst Tanner James upgraded the generator company to buy from hold on Friday. He also raised its price target to $302 from $239, implying nearly 22% upside from Thursday’s close. “Given the continued strong environment for data center development, and potential indications of activity with hyperscalers, we see an asymmetric positive risk/reward setup,” James said in a note to clients. GNRC YTD mountain Generac year to date There are ongoing negotiations with multiple hyperscalers for large backup generator supply contracts and two potential announcements from Generac this year, he said. “Baudouin engines are finding their way into hyperscaler configurations, pointing to market acceptance for a product only GNRC can ably scale,” he said. Generac shares were up more than 3% following the upgrade. Analysts in general are mostly bullish on the stock. Of the 21 who cover it, 13 have a buy or strong buy rating, according to LSEG data. To be sure, Jefferies’ price target is ahead of the $267.02 average. Shares of Generac are up nearly 82% so far this year.
