Generac Stock Gains On Solid Q1, Raised FY22 Sales Growth Outlook

Generac Holdings Inc GNRC reported first-quarter FY22 sales growth of 41% year-on-year to $1.14 billion, beating the consensus of $1.09 billion.
Residential product sales grew 43% to $777 million, and Commercial & Industrial (C&I) product sales increased 38% to $279 million.
Domestic segment sales increased 39% to $964.7 million, and the International segment sales rose 49% to $171.2 million.
Adjusted EPS of $2.09 beat the analyst consensus of $1.94.
Gross profit increased to $360.7 million. The gross profit margin contracted by 810 basis points Y/Y to 31.8%, pressured by higher input costs due to supply chain challenges and the overall inflationary environment.
Operating expenses increased by 55.3% Y/Y to $206 million. The operating margin was 13.6%, and operating income for the quarter declined 18.2% to $154.7 million. Adjusted EBITDA of $196.4 million fell 8.4% Y/Y.
The company held $206 million in cash and equivalents as of March 31, 2022.
Outlook: Generac has raised FY22 net sales growth guidance to 36% - 40% from 32% - 36%.
It expects an adjusted EBITDA margin of 21.5% – 22.5% versus previous expectation of 22.0% - 23.0%.
Price Action: GNRC shares are trading higher by 4.60% at $244.95 on the last check Wednesday.

Momentum24.73

Growth99.45

Quality83.94

Value17.32

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