Value
6.1/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 1.7 |
| P/S | 8.4 |
| EV/EBITDA | 0.0 |
| Fwd P/E | 7.0 |
| PEG | 7.7 |
| Analyst target | 9.0 |
- ▸Forward P/E: 17.9x
- ▸PEG: 0.88
GNRC · Why this verdict
Why Generac Holdlings (GNRC) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.7/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
A growth-oriented industrial name with a perfect Piotroski financial health score is held back by a negative risk/reward at current prices — the stock sits above its resistance target with roughly 12% of defined downside against 6.7% of stated upside — combined with an exceptionally elevated put/call ratio and two recent consecutive earnings misses that introduce meaningful uncertainty about near-term delivery.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
A perfect Piotroski F-Score of 9 out of 9 signals broad financial health across balance sheet, profitability, and operating efficiency dimensions; however, the overall quality score remains below average, reflecting thin margins and below-peer returns that do not yet support a premium multiple. Quality | The below-average quality assessment clears if free cash flow conversion rises above 80% of net income and overall quality improves materially over the next 4 quarters. | →Stable |
| CounterTwo consecutive prior quarterly misses indicate execution has been inconsistent in recent periods; a perfect Piotroski score reflects historical financial health that may lag actual near-term delivery, and the most recent beat of 35% has not yet been confirmed as the start of a new consistent trend. | ||
With the stock already above its take-profit resistance ceiling and the asymmetry ratio firmly negative — implying roughly 6.7% in stated upside against approximately 12% of defined downside — the risk/reward at current prices is unfavorable, and the setup does not offer a margin of safety for new entry. V9 | The setup improves if the price retreats below $258, creating upside greater than 12% to the $288 resistance target, or if the analyst consensus target is revised materially above $300. | Tripped→Stable |
| CounterA recent analyst mention in news coverage and the bull case's reference to a strong growth profile suggest the street may revise price targets higher; if consensus moves above $300, the current resistance ceiling becomes the new floor and an entry at today's price would look prescient in retrospect. | ||
A put/call ratio of 3.88 is exceptionally elevated and indicates the options market is positioned very heavily for further downside; this degree of hedging typically reflects institutional concern about a specific near-term catalyst risk and creates a meaningful technical overhang on the share price. Risk | The bearish positioning clears if the put/call ratio falls below 1.5 over the next quarter, indicating hedges have been unwound and sentiment has normalized. | →Stable |
| CounterThe most recent quarterly result delivered a 35% upside earnings surprise; if a similarly strong print occurs in the next reporting period, forced unwinds of put positions and short covers could amplify a sharp upward move, turning the elevated hedging into a contrarian tailwind. | ||
Two consecutive quarterly misses — with surprises of approximately -17% and -9% in the October 2025 and February 2026 quarters respectively — followed by a most recent beat of 35% show volatile earnings delivery that makes forward estimates unreliable and warrants caution despite the positive most recent print. Earnings | Delivery consistency is established if the next 2 quarterly prints each produce positive EPS surprises, demonstrating the prior miss streak was anomalous. | →Stable |
| CounterThe most recent quarterly beat of 35% demonstrates the business retains the capacity for large upside surprises, and the bull case cites a strong growth profile; if the underlying demand environment is strengthening, the prior two misses may reflect a discrete execution issue rather than an ongoing structural problem. | ||
A perfect Piotroski F-Score of 9 out of 9 signals broad financial health across balance sheet, profitability, and operating efficiency dimensions; however, the overall quality score remains below average, reflecting thin margins and below-peer returns that do not yet support a premium multiple.
→StableQuality
- Expectation
- The below-average quality assessment clears if free cash flow conversion rises above 80% of net income and overall quality improves materially over the next 4 quarters.
CounterTwo consecutive prior quarterly misses indicate execution has been inconsistent in recent periods; a perfect Piotroski score reflects historical financial health that may lag actual near-term delivery, and the most recent beat of 35% has not yet been confirmed as the start of a new consistent trend.
With the stock already above its take-profit resistance ceiling and the asymmetry ratio firmly negative — implying roughly 6.7% in stated upside against approximately 12% of defined downside — the risk/reward at current prices is unfavorable, and the setup does not offer a margin of safety for new entry.
Tripped→StableV9
- Expectation
- The setup improves if the price retreats below $258, creating upside greater than 12% to the $288 resistance target, or if the analyst consensus target is revised materially above $300.
CounterA recent analyst mention in news coverage and the bull case's reference to a strong growth profile suggest the street may revise price targets higher; if consensus moves above $300, the current resistance ceiling becomes the new floor and an entry at today's price would look prescient in retrospect.
A put/call ratio of 3.88 is exceptionally elevated and indicates the options market is positioned very heavily for further downside; this degree of hedging typically reflects institutional concern about a specific near-term catalyst risk and creates a meaningful technical overhang on the share price.
→StableRisk
- Expectation
- The bearish positioning clears if the put/call ratio falls below 1.5 over the next quarter, indicating hedges have been unwound and sentiment has normalized.
CounterThe most recent quarterly result delivered a 35% upside earnings surprise; if a similarly strong print occurs in the next reporting period, forced unwinds of put positions and short covers could amplify a sharp upward move, turning the elevated hedging into a contrarian tailwind.
Two consecutive quarterly misses — with surprises of approximately -17% and -9% in the October 2025 and February 2026 quarters respectively — followed by a most recent beat of 35% show volatile earnings delivery that makes forward estimates unreliable and warrants caution despite the positive most recent print.
→StableEarnings
- Expectation
- Delivery consistency is established if the next 2 quarterly prints each produce positive EPS surprises, demonstrating the prior miss streak was anomalous.
CounterThe most recent quarterly beat of 35% demonstrates the business retains the capacity for large upside surprises, and the bull case cites a strong growth profile; if the underlying demand environment is strengthening, the prior two misses may reflect a discrete execution issue rather than an ongoing structural problem.
Per-dimension breakdown
Quality
4.8/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 2.5 |
| ROA | 2.5 |
| Gross margin | 3.6 |
| Op margin | 4.4 |
| Net margin | 2.2 |
| Current ratio | 7.1 |
| FCF quality | 4.7 |
| Moat | 6.4 |
| Piotroski F | 10.0 |
- ▸Earnings quality warning: 61% FCF/NI
- ▸Strong Piotroski F-Score: 9/9
Growth
7.8/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 5.6 |
| EPS growth | 10.0 |
Momentum
2.1/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.0 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 2.2 |
| Volume | 4.5 |
- ▸Capitulation risk (RSI 7, below 200MA)
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA but MA still rising (+5.5%/30d) — pullback in uptrend, not confirmed weakness
Sentiment
7.7/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 6.5 |
| Analyst rating | 7.3 |
| Price target | 9.4 |
- ▸Analyst upside: 45%
Insider
5.9/10data confidence 100%| Component | Sub-score |
|---|---|
| materiality | 4.5 |
| insider conviction | 2.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸Modest insider selling — $4,391,793 (0.037% of mkt cap)
- ▸Institutions accumulating
Peer rank
4.4/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 3.7 |
| quality rank | 3.1 |
| growth rank | 6.3 |
Technical
7.1/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 8.3 |
| support resistance | 9.5 |
| 52w position | 3.6 |
Risk (lower is worse)
5.6/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 8.3 |
| days to cover | 9.0 |
| volatility | 0.0 |
| put call | 10.0 |
| implied vol | 0.0 |
| beta | 3.7 |
| debt equity | 7.9 |
- ▸High IV: 95%
- ▸Concentration risks: 1 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 6.8 |
| news activity | 5.0 |
- ▸Earnings concerns: 2B/2M
- ▸Earnings in 4 days
How the verdict was assembled
Engine trigger
Mixed signals. Hold existing position. | News modifier -2 (HOLD_IF_HOLDING → SELL_IF_HOLDING).
Engine technical detail
verdict_path:
L4:PATH_F_HOLD_DEFAULT|L3:NEWS_MOD=-2Passed (6)
- ASYMMETRY:3.0>=1.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:2.1<4.5
- EARNINGS_PROXIMITY:4d<=7d
Warning (0)
none
Reward-to-Risk
3.01
Upside
+30.9%
Downside
10.2%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — Beta 1.90>1.3
Investment implication
The default F-path HOLD fired without any positive-conviction gate triggering — no momentum acceleration, no quality+value crossover, no setup recognition. Highest-clear gate: ASYMMETRY:3.0>=1.5. Top dim: Growth at 7.8; weakest: Momentum at 2.1. The engine's read is one of pattern absence — no directional conviction in either direction at current asymmetry.
The strongest dimensions are Growth at 7.8, Sentiment at 7.7, and Technical at 7.1; the weakest are Momentum at 2.1, Peer rank at 4.4, and Quality at 4.8. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of 3.01 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Strong Piotroski But Weak Overall Quality
Trip ifFree cash flow conversion rises above 80% of net income for 2 consecutive quarters, removing the earnings quality warning and indicating the below-average quality score was a lagging indicator.
- P2Negative Risk Reward Above TargetTripped
Trip ifPrice retreats below $258, creating upside greater than 12% to the $288 resistance target and restoring a favorable risk/reward.
- P3Elevated Options Bearish Positioning
Trip ifPut/call ratio falls below 1.5 for 2 consecutive weeks, indicating the bearish hedging overhang has been substantially absorbed.
- P4Inconsistent Earnings Delivery
Trip ifEPS surprise remains positive (above 0%) for 3 consecutive quarters, demonstrating sustained recovery from the prior 2-quarter miss streak.