GE Vernova Projects Growth But Notes Challenges In Wind Segment

On Tuesday, GE Vernova GEV hosted its 2024 Investor Update event to present its multi-year financial outlook and frame its capital allocation strategy.

"We remain committed to maintaining an investment grade balance sheet as we make organic investments, pursue targeted M&A, and return at least one-third of cash generation to shareholders through dividends and share repurchases," said GE Vernova CFO Ken Parks.

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The company forecasts higher revenues for 2025 of $36 billion—$37 billion compared to the consensus of $37.25 billion, up from mid-single-digit organic growth (implied sales of $35 billion—$37 billion).

It also sees free cash flow rising to between $2 billion and $2.5 billion in 2025, up from the higher end of $1.3 billion to $1.7 billion in 2024

The company also authorized a $6 billion share buyback and a new quarterly dividend of 25 cents per share.

GE Vernova forecasts around $45 billion in revenue and a 14% adjusted EBITDA margin by 2028, with plans to invest approximately $4 billion in capital expenses and $5 billion in R&D by 2028.

The company projects generating at least $14 billion in free cash flow from 2025 to 2028.

In its investor presentation, the company said it has started installation at both offshore wind projects. The wind business is on track for modest profitability in the fourth quarter of 2024, but the company remains cautious about the timing of onshore order inflection.

The company expects wind revenue to be down by mid-single digits in 2025, compared to the forecast of flat revenue this year.

GE Vernova expects a stabilizing Offshore wind execution, with

• Completed root-cause analysis of the blade events and remediated them as necessary.
• Installing blades, nacelles, & towers at both project sites, with 56 turbines installed.
• Evaluating economics to accelerate completion while ensuring safety and quality.
• Progressing to achieve synergies with Onshore Wind.

Price Action: GEV stock is up 4.6% at $342.95 at last check Wednesday.

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