Generac Holdings Inc. (GNRC) — Fundamental Analysis & Key Financial Ratios

Kaplio's reading: Generac Holdings Inc.

Updated on October 31, 2026 · accounts published on October 28, 2026

A cash-generative industrial whose margins have slipped to a multi-year low

Generac trades at a P/E of 39.2× over the last 12 months, 52 % above its sector median and 36 % above its ten-year median of 28.7×.

• Is Generac expensive or cheap? Generac's P/E of 39.2× is 52 % above its sector median of 25.9× and higher than in 69 % of the past decade.
• How is the business doing? Generac's operating margin of 6.9 % in fiscal 2025 was its lowest in 12 years, against a 2014-2025 average of 15 %.
• How strong is the balance sheet? Generac's net debt of $18.15 per share in fiscal 2025 equals 9 % of the share price and 2.1× EBITDA, below the healthy 3.0× limit.
• What to expect from the next earnings? Analysts expect EPS of $2.57 from Generac on February 10, 2027, and 28 of the 40 who cover it rate it a buy.
• Does Generac turn its margin into cash, and what multiple of the cycle does it trade at? Generac's free cash flow was 168 % of net income in fiscal 2025, nearly double the 85 % that marks a healthy industrial.

Is Generac expensive or cheap?

Over the last 12 months Generac trades at a P/E of 39.2×. That is 36 % above its ten-year median of 28.7× and 52 % above the 25.9× median of its 297-company sector. The stock has traded at a lower P/E in 69 % of the past decade, within a range of 10.8× to 88.9×. Much of that premium comes from earnings that halved over the last 12 months, because the share price sits 33 % below its 52-week high of $295.54. Cash-based measures look calmer: EV/EBITDA of 18.3× is close to its seven-year average of 19.2×, and the free cash flow yield is 3.5 %.

How is the business doing?

Revenue fell 2 % over the last 12 months while EPS dropped 50 %, so profits shrank much faster than sales. The operating margin over the last 12 months is 10.4 %. That is a partial recovery from 6.9 % in fiscal 2025, the weakest of the 12 fiscal years since 2014 and well below the 15 % average for that period. Returns tell the same story. ROIC of 7.5 % sits 1.6 points below the 9.1 % sector median, after clearing 10 % in six of the last ten fiscal years. Over the longer run, revenue per share grew 12.5 % a year from 2020 to 2025.

How strong is the balance sheet?

Debt is not the problem here. Net debt in fiscal 2025 was $18.15 per share ($23.99 of debt less $5.83 of cash). That is about 9 % of the current share price and 2.1× EBITDA, comfortably below the 3.0× that marks a healthy level for industrials. Over the last 12 months debt to equity stands at 0.44 and the current ratio at 1.97, so short-term obligations are covered almost twice over. The Altman Z of 3.6 sits in the safe zone above 2.99. A Piotroski score of 5 out of 9 points to fundamentals that are middling but not deteriorating.

What to expect from the next earnings?

Generac beat EPS estimates in 6 of the last 8 quarters. The latest report, on October 28, 2026, came in at $2.54 against $2.40 expected, a 6 % beat. Expectations have held steady: over the last 30 days the 2026 EPS consensus moved only from $9.70 to $9.66 across 14 analysts, and the revenue consensus barely changed. Of the 40 analysts covering the company, 28 recommend buying, 12 recommend holding and none recommend selling. The next test comes on February 10, 2027, with a consensus of $2.57 per share, slightly above the latest quarter.

Does Generac turn its margin into cash, and what multiple of the cycle does it trade at?

Industrials are semi-cyclical, so a single year's earnings can mislead. That is why the sector is judged on operating margin, cash conversion and multiples measured across the cycle. Generac converts well: in fiscal 2025 free cash flow reached 168 % of net income, and capex took 4 % of revenue, at the low end of the healthy 4 % to 8 % range. The weak spots are profitability. The operating margin of 6.9 % compares with a healthy 12 %, and ROIC of 7.5 % compares with 15 %. Cycle-adjusted EV/EBITDA of 18.3× sits near its seven-year average of 19.2×, while the P/E of 39.2× is above its ten-year average of 33.9×.

How this was prepared: the data comes from companies' official filings, collected by a professional provider, and from Kaplio's analysis engine (trailing-12-month ratios, 10 years of history and sector medians computed across US-listed companies). The text is written from that data alone, every figure is checked against it before publication, and it is reviewed when the company reports results. This is not investment advice.