Generac stock tumbles as data center deal hopes disappoint

Investing.com -- Generac Holdings (NYSE: GNRC) shares fell 11% Wednesday as the company held its 2026 Investor Day, with the stock declining despite positive updates on its data center business backlog.

The stock dropped after the company failed to announce an anticipated long-term agreement with a hyperscaler during the event. Shares were down approximately 10% midway through the meeting as investor expectations for a major contract announcement went unmet.

Generac reported that its backlog for data center products increased by about 75% over the last six weeks, highlighting growing demand in the sector. The data center opportunity has become a key focus area for investors tracking the company’s growth prospects.

Management maintained its 2026 guidance, projecting revenue growth at a mid-teens rate. The company expects residential segment sales to grow about 10%, while commercial and industrial revenue is forecast to increase in the low- to mid-20% range. EBITDA margin guidance remained unchanged at 18%-19% for 2026.

William Blair analyst Brian Drab commented, "We believe the pullback offers a buying opportunity."

The company’s investor day centered on its positioning in the data center industry, a sector experiencing significant expansion driven by artificial intelligence and cloud computing infrastructure needs.

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