DCF Studio

    GNRC · NYQ · Industrials

    Generac Holdings Inc.

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 191.12

    Market price

    USD 202.04

    Implied upside

    -5.4%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    AdjustedFree cashflow is negative in at least one forecast year, so terminal value carries most of the valuation.

    Current EV/EBITDA of 27.0x sits outside a defensible 3-20x band, so the exit multiple is capped at 20.0x. A multiple that far out usually means EBITDA is the wrong denominator for this business.

    Value Per Share

    Perpetuity growth
    USD 191.12-5.4%
    Exit multiple
    USD 505.69+150.3%
    Market price
    USD 202.04

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    -0bn1bn2bnFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 4.9bnUSD 6.8bnUSD 9.2bnUSD 11.9bnUSD 14.9bnUSD 18.0bnUSD 20.9bnUSD 23.4bnUSD 25.0bnUSD 25.6bn+20.1%
    EBITUSD 509.6mUSD 707.7mUSD 950.4mUSD 1.2bnUSD 1.5bnUSD 1.9bnUSD 2.2bnUSD 2.4bnUSD 2.6bnUSD 2.6bn+20.1%
    NOPATUSD 402.6mUSD 559.0mUSD 750.8mUSD 974.3mUSD 1.2bnUSD 1.5bnUSD 1.7bnUSD 1.9bnUSD 2.0bnUSD 2.1bn+20.1%
    Add depreciation & amortisationUSD 199.4mUSD 276.9mUSD 371.9mUSD 482.6mUSD 604.3mUSD 729.3mUSD 846.9mUSD 945.1mUSD 1.0bnUSD 1.0bn+20.1%
    Less capital expenditureUSD -151.7mUSD -217.7mUSD -301.8mUSD -403.8mUSD -521.0mUSD -647.2mUSD -773.1mUSD -886.6mUSD -974.7mUSD -1.0bn+23.7%
    Capex, % of revenue3.1%3.2%3.3%3.4%3.5%3.6%3.7%3.8%3.9%4.0%-
    Less increase in working capitalUSD -237.3mUSD -632.5mUSD -775.5mUSD -903.7mUSD -993.6mUSD -1.0bnUSD -960.4mUSD -801.2mUSD -543.4mUSD -206.5m-1.5%
    Free cashflow to firmUSD 213.0mUSD -14.2mUSD 45.5mUSD 149.5mUSD 309.8mUSD 534.4mUSD 823.3mUSD 1.2bnUSD 1.5bnUSD 1.9bn+27.5%
    Discount factor0.95030.85810.77480.69970.63180.57050.51520.46520.42010.3793-
    Present valueUSD 202.4mUSD -12.2mUSD 35.2mUSD 104.6mUSD 195.7mUSD 304.9mUSD 424.1mUSD 542.1mUSD 645.2mUSD 720.1m-
    Present Value Of The ForecastUSD 3.2bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta1.566Reported 1.845, pulled toward 1.0 (Blume)
    Cost of equity11.52%Risk-free + beta x equity risk premium
    Cost of debt5.78%Risk-free + 89bp, the spread for a A- rating at 4.1x interest cover. Book interest / average debt was lower, at 4.8%.
    Market capitalisationUSD 11.9bn88.8% of capital
    Total debtUSD 1.5bn11.2% of capital, book value as a proxy
    Tax rate21.0%Effective, capped at statutory
    WACC10.74%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 191.12

    75% of EV

    Forecast FCFF, final year
    USD 1.9bn
    Capex at depreciation, working capital in reinvestment
    USD 2.6bn
    Less reinvestment at g/ROIC (23.3% of NOPAT)
    USD -599.5m
    Capitalised
    USD 2.0bn
    ROIC (WACC floor)
    10.7%
    Terminal value, undiscounted
    USD 24.6bn
    Terminal value, discounted
    USD 9.3bn
    Enterprise value
    USD 12.5bn
    Less net debt
    USD 1.2bn
    Equity value
    USD 11.3bn

    Exit at 20.0x EBITDA

    Value per shareUSD 505.69

    90% of EV

    Terminal value, undiscounted
    USD 73.7bn
    Terminal value, discounted
    USD 28.0bn
    Enterprise value
    USD 31.1bn
    Less net debt
    USD 1.2bn
    Equity value
    USD 30.0bn

    Spread between methods: 90%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    8.74%280.30278.30276.61275.32274.53
    9.74%231.63227.95224.27220.59216.91
    10.74%197.42194.27191.13187.98184.83
    11.74%169.70166.98164.26161.54158.82
    12.74%146.89144.52142.15139.78137.41

    Outlined: this model. Green text: above today's price of 202.04. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year-2.7%19.8%20.5%
    EBIT margin12.5%10.3%10.8%
    Discount rate-10.7%10.4%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.