GE Vernova Initiated at Buy by UBS with $614 Price Target, Sees AI-Driven Power Demand Boosting Earnings

GE Vernova initiated with a Buy rating and $614 price target by UBS, citing structural upcycle in power generation driven by surging electricity demand. The wind turbine maker is expected to benefit from this trend.

UBS has initiated coverage on GE Vernova Inc. (GEV) with a Buy rating and a $614 price target, citing a structural upcycle in power generation driven by surging electricity demand. The wind turbine maker is expected to benefit from this trend, which is poised to boost earnings growth over the next five years.

According to UBS analysts, GE Vernova is positioned to benefit from a 4% annual rise in global electricity demand, accelerating into the second half of the decade. The analysts estimate that GE Vernova is only about one-quarter of the way through its earnings expansion opportunity for this cycle, with potential for operating profit to triple by 2030.

The firm's $614 price target implies a 20% upside from recent levels and is based on a 28x EV/EBITDA multiple, roughly 70% to 80% above the broader industrials sector. UBS sees margin expansion supported by improved pricing discipline, backlog profitability, and lean cost structures.

GE Vernova's Electrification segment has been a key growth engine, recording year-over-year revenue growth of 14% in the first quarter of 2025, 11% in the fourth quarter of 2024, 22% in the third quarter of 2024, and 19% in the second quarter of 2024. This segment includes Grid Solutions, Power Conversion, solar and storage systems, and electrification software businesses.

Other companies in the industry, such as Siemens Energy and Eaton Corp., are also benefiting from the surge in electricity generation and the resultant grid modernization and integration of renewable energy, underscoring the clean energy industry's broad growth potential.

References:
[1] https://www.theglobeandmail.com/investing/markets/stocks/GEV/pressreleases/33144908/ge-vernovas-electrification-arm-powers-solid-growth-ahead/
[2] https://ca.finance.yahoo.com/news/ubs-starts-ge-vernova-buy-153608935.html
[3] https://seekingalpha.com/news/4465676-ge-vernova-started-at-buy-at-ubs-as-earnings-seen-lifted-by-ai-driven-power-demand