GE Vernova $GEV ( ▲ 3.07% ) moved higher Monday after Evercore ISI initiated coverage of the AI energy and power generation company with an outperform rating and an $860 price target. That target implies roughly 27% upside from current levels, giving fresh fuel to a stock that has already more than doubled this year.
A Fresh Bull Enters the Chat
Evercore pointed to strong growth visibility across GE Vernova’s Power and Electrification businesses, supported by a deep backlog that stretches well into the 2030s. While the company’s Wind segment remains a drag, analysts still expect a 12% compound annual growth rate from 2026 through 2028, making it the fastest growing name in Evercore’s coverage outside of Siemens Energy.
Margins Do the Heavy Lifting: Margins are another key part of the bull case. Evercore expects operating leverage, pricing power, and productivity gains to continue lifting profitability in both Power and Electrification. Full ownership of Prolec, expected to close in mid-2026, could drive another round of upward estimate revisions.
The firm also sees equipment pricing and margin expansion eventually carrying over into higher margin service revenues in the next decade.
The Valuation Tightrope
Shareholder returns round out the thesis. Evercore forecasts EBITDA margins rising from 7% in 2024 to 21% by 2028, with average free cash flow topping $5 billion per year. That cash generation underpins a recently expanded $10 billion buyback authorization, up from $6 billion, alongside a higher dividend.
Still, there are reasons for caution. GE Vernova’s wind business continues to struggle and could weigh on overall results. Valuation is another pressure point, with the stock trading at roughly 55 times forward earnings, leaving little room for disappointment.
Evercore also warned that investor sentiment around the shares is tightly linked to the AI data center cycle. Any signs of delays in data center buildouts or weaker energy demand could hit the stock, as markets would quickly worry about overcapacity.