Key Takeaways:
- The 2-Minute Valuation Model values GEV stock at $560 per share in 2 years.
- That’s a potential 31% upside from today’s price of $427 per share.
- GE Vernova is projected to grow EPS by an extraordinary 510% over the next 3 years.
- The company is capitalizing on massive green energy infrastructure and grid modernization trends.
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GE Vernova (GEV) is one of the most exciting transformation stories in industrial technology, having spun off from General Electric to focus exclusively on electrification and the global energy transition.
With its portfolio spanning power generation equipment, grid solutions, and renewable energy platforms, GE Vernova is positioned at the center of the world’s shift to cleaner and more resilient power infrastructure.
With GEV stock now trading at $427, investors question whether this newly independent company can deliver on its ambitious growth projections.
Let’s analyze the growth trajectory and determine whether GE Vernova offers a compelling opportunity.
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What is the 2-Minute Valuation Model?
Three core factors drive a stock’s long-term value:
- Revenue Growth: How big the business becomes.
- Margins: How much the business earns in profit.
- Multiple: How much investors are willing to pay for a business’s earnings.
Our 2-Minute Valuation Model uses a simple formula to value stocks:
Expected Normalized EPS * Forward P/E ratio = Expected Share Price
Revenue growth and margins drive a company’s long-term normalized earnings per share (EPS), and investors can use a stock’s long-term average P/E multiple to get an idea of how the market values a company.
Why GE Vernova Stock Looks Undervalued
Forecast
Based on analyst estimates shown in the chart below, GE Vernova is expected to achieve remarkable earnings growth over the next several years.
This extraordinary earnings trajectory would result in a 510% total increase in EPS from 2024 to 2027, reflecting GE Vernova’s transition from a company in transformation to a highly profitable energy technology leader.
This earnings growth for GEV stock is likely to be driven by:
- Grid modernization: GE Vernova’s grid solutions business capitalizes on the massive investment cycle for electrical grid infrastructure upgrades needed to support electrification and renewable integration.
- Wind power recovery: After a challenging period in the wind turbine market, GE Vernova’s offshore and onshore wind businesses are expected to return to profitability as pricing improves and manufacturing efficiency increases.
- Gas power stability: The company’s gas turbine business provides steady cash flow and serves as a bridge technology in the energy transition.
- Margin expansion: GE Vernova is aggressively streamlining operations, with significant cost-cutting initiatives expected to boost margins substantially over the next three years.
- Energy transition spending: Government initiatives like the Inflation Reduction Act in the U.S. and similar programs globally are driving unprecedented investment in clean energy infrastructure.
For our valuation, we’ll estimate that GEV stock will reach $14 in EPS in 2027.
Check out GE Vernova’s full analyst estimates (It’s free) >>>
GE Vernova Stock Trades at a Premium
GEV stock currently trades at around 57x forward earnings, above its 12-month historical average of 47x, as shown in the P/E chart.
While the stock’s valuation has moved higher in recent months, it continues to trade at a premium multiple in May 2025.
For our valuation, we’ll use a relatively conservative forward P/E multiple of 40x, slightly below where the stock trades today, acknowledging the volatile macro environment.
It’s typical for high-quality businesses to trade at a P/E multiple that’s 1-2x annual EPS growth. Considering the company is expected to grow EPS 63% in 2026 and 37% in 2027, a 40x P/E multiple would be reasonable for the stock.
Fair Value of GEV Stock
Using our 2-Minute Valuation Model and applying a conservative approach:
- Conservative 2027 EPS estimate: $14
- Conservative forward P/E multiple: 40x
Expected Normalized EPS ($14) * Forward P/E ratio (40x) = Expected Share Price ($560)
The 2-year expected GEV stock price we would get from this valuation is $560 per share.
With GE Vernova stock currently trading at around $427 per share, this implies a potential upside of 31% over the next two years or a 15% annualized return.
GEV stock could deliver above-average market returns at this price, given that the broader market’s average annual returns over the long term have been around 10%.
Remember, this is just a valuation exercise, and we don’t know for sure what the stock’s price will be in the future.
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What is the Target Price for GEV Stock?
However, analysts think that GEV stock is overvalued at current prices.
Wall Street has an average price target of around $408 per share for GE Vernova stock, indicating they see about 5% downside today based on its current share price:
Some analysts see even greater upside, with price targets ranging as high as $525 per share, suggesting potential upside of over 20% from current levels.
This wide range of targets reflects the opportunity and uncertainty surrounding high-growth companies like GE Vernova.
Risks to Consider
Despite the bullish outlook, investors should be aware of several risks that could impact GEV’s growth trajectory:
- Project execution: Large-scale power and grid projects carry significant execution risk and potential cost overruns.
- Policy uncertainty: Changes in government incentives or regulations could impact demand for renewable energy systems.
- Supply chain challenges: Persistent supply chain disruptions could delay projects and increase costs.
- Competition: The renewable energy sector is becoming increasingly competitive, with pressure on margins from both traditional competitors and new entrants.
- Interest rate sensitivity: Higher interest rates increase the cost of capital-intensive renewable energy projects, slowing demand.
TIKR Takeaway
GE Vernova presents a compelling investment case at its current valuation. While the stock trades at a premium multiple, the company’s monstrous projected earnings growth and exposure to secular trends in electrification and clean energy infrastructure support this valuation.
GEV’s diversified portfolio across renewable energy, grid solutions, and gas power provides both growth potential and stability.
As the global energy transition accelerates, GE Vernova is positioned to benefit from increased spending on grid modernization, renewable energy capacity, and the need for reliable power systems.
Is GEV stock a buy for the next 24 months? Use TIKR to check the stock’s analyst price targets and growth forecasts to see if it is undervalued today.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
