Generac's Got Game: CEO Aaron Jagdfeld Goes Over Great Q2 And Beyond

Q2 results came in with a boom, beating out analysts' expectations by $0.19, with EPS at $0.95 over estimates of $0.76. Their revenue came is at $346.7 million for the quarter, over analysts' estimates of $328.41 million. The generator company's CEO Aaron Jagdfeld dropped by CNBC's Squawk Box on Tuesday morning to discuss Q2, and Generac's future profitability. "The home standby category…That category has kind of really come to life here in the last few years and it's taken off," Jagdfeld said. Jagdfeld noted that their guidance for the second half of the year doesn't assumes that storms will occur, and said that much of their current slowdown in sales is in the area of small, portable generators, not their larger, natural gas-powered standby units.

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He mentioned that when businesses loose power for extended periods of time and don't have generators as a backup, their revenue stream, perishable inventory, and other costing factors are impacted. Jagdfeld said that while standby generators are getting popular, he has no fear that large corporations will swoop in and try to snag his business away from him. "It's still a pretty small market. It's 3 percent of U.S. households that have the product today. Now that's up from 2 percent a couple of years ago and it's been accelerating here recently," said Jagdfeld. "You know, it still, we just built our one millionth generator. It's all we do, so we're pretty focused on generators. It's kind of a nichey space. There's a little bit of specialized knowledge that you need, but I do think eventually, you know, if the category continues to grow, if it becomes like a central air conditioning at some point, you're going to see more corporations jump into it." According to Jagdfeld, typically natural gas infrastructure stays up during most severe conditions, with the exception of devastating earthquakes, meaning that most disasters don't effect their standby generators that run on it.