Generac (GNRC)

Before and today they said they were getting big orders from the hyperscalers who want back-up generators. He doesn't like two rallies, based on the same catalyst, but this market will take such shortages to drive shares higher--up 16.49% today.

They report Wednesday. He wants to hear how data centres are using their products as backup power. 

There were no hurricanes, tornadoes or mass outages which usually drive this stock. He sold this at $160. Is a bit of an AI play; they make generators for data centres.

(Note the short timeframe.)  Volatile name. Long-term investment in the fact that the grid is collapsing. Great growth, trades at less than market multiple. Simple to understand.

Generators are in strong demand across North America. Small increase in demand for product will see large increases in profits. Backup power is more important now especially with EV and A.I. data center demand. Excellent growth prospects, and seeing value in current share price. 

This pulled back with the market in December. He would add more shares as it maintains support and continues its uptrend.

We think it is a hold, although growth has been slow/declining and it is not cheap at 19x forward earnings. EPS is forecasted to grow at approximately ~20% annually for the next three years, so there is some appeal if GNRC can start consistently meeting/beating expectations. The risk is that it does not offer a safety net of any dividend, but GNRC does have a decent buyback yield at 3.51%. We do not think it is a must own, but it does have high cash flows and if revenue and earnings growth picks up it could look more attractive.
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80% of the North American market is owned by Generac. The market is about 6.5% penetrated. Every 1% increase in penetration increases revenues by about $6B to the industry, so you can do the math. Hurricanes and weather outages are what drive this company. Sees outages continuing as the grid deteriorates. 

An interesting play on grid deterioration, and people taking matters into their own hands when you can't trust the local power company.

Turns out that it had a lot more to do with interest rates than expected, but it's now okay as interest rates decline. This has another 10-15 points to run.

Likes it, but with these companies, you need credit to buy their solar products, and the price of credit keeps rising,

Be patient with this. A hurricane season will be a boon, because they make emergency generators. This is volatile.