Waterworld Capital
Public Markets Commentary
GE Vernova is a cyclical gas-turbine manufacturer priced as a secular compounder, the basis for a sell rating. Per @StockWorthyApp, the stock fell 8.62% in a day and 9.43% over a week on concerns about an AI development slowdown. x.comÂ
GE Vernova is highly expensive, and infrastructure booms always look unstoppable until they stop; a cyclical boom-bust stock should not need a three-years-out view to reach a 20 P/E. Gordon Johnson's $470 price target is right in theory. Barring a crash, it is probably among the safer expensive stocks through year end as fund managers pad top holdings, but the cycle will pass, as similar ones did before the financial crisis. x.comÂ
Durable demand makes these eight companies attractive at forward earnings multiples below their historical medians. Vistra has long power deals; ASML expects demand above capacity in 2027-28; GE Vernova's turbines are sold out through 2028. Eaton expects data-center deliveries from 2028. Waste Management leads garbage collection; American Tower has $23B in scheduled rent, Linde $64B in commitments, and BWX Technologies an $8.4B backlog backed by Navy demand. GE Vernova's multiple is still high. … Show more
GE Vernova is not worth owning even after its pullback, because at 45 times forward earnings it looks expensive when Celestica and Bloom Energy offer much better growth at half the multiple. x.com x.comÂ
GE Vernova's buybacks look poorly priced relative to its borrowing cost. At $895, repurchases yield about 2.6% on my 2027 EPS estimate of $23.09 and 3.5% on 2028 earnings, below the 3.8% after-tax cost of debt issued in February. The quarter was strong, but this buyback pace is hard to like. x.comÂ
GE Vernova's turbines and grid equipment make it a clear winner from the AI data-center power crunch. Q3 equipment sales rose 42%, total revenue 27% and operating income 281% as margins expanded. Grade: A. x.comÂ
GE Vernova's tanking earnings are a dealbreaker, even after the stock's 60% gain in six months. It had been an earlier pick for 2026 as the year of energy following AI's year in 2025. x.comÂ
Siemens Energy's valuation is reasonable given the demand and lead times for gas turbines and electrical gear, and it adds some grid modernization exposure. x.comÂ
GE Vernova is poised to make massive profits because energy is the key bottleneck for the hyperscalers it supplies. Its EPS numbers are huge, and MarketSurge charts recently flagged a buy signal. x.comÂ
GE Vernova doesn't look bullish, and unusual bearish options flow backs that up. An $18M put buyer rolled from August 21 $1,100 puts down and out into October 16 $1,000 puts. x.com x.comÂ