GE Vernova's Electrification Arm Powers Solid Growth Ahead

While headlines often focus more on GE Vernova Inc.’s GEV wind and gas turbine businesses, the company’s Electrification segment has always played the role of a key growth engine. In a world racing toward clean energy, the focus lies on modernizing outdated grids and enabling smarter power distribution for efficient energy systems, and GEV is capitalizing on this trend.

The growing demand for large-scale transmission equipment to interconnect renewables and transport bulk power has surged in recent years, driven by rising electricity needs, particularly from the adoption of electric vehicles and the rapid expansion of data centers. At the same time, to accommodate increased electricity generation from renewable sources and enable more efficient storage, significant investments are being made by both governments and private players in grid infrastructure upgrades.

These developments are playing in favor of GE Vernova’s Electrification segment, which includes Grid Solutions, Power Conversion, solar and storage systems, and electrification software businesses. As a key conductor in the global energy transition orchestra, this segment has benefited from strong order growth, which is now translating into meaningful revenue gains.

Evidently, GEV’s Electrification segment recorded year-over-year revenue growth of 14% in first-quarter 2025, 11% in fourth-quarter 2024, 22% in third-quarter 2024 and 19% in second-quarter 2024, primarily driven by the continued strong demand for its transformers, switchgears and other key grid equipment. 

Looking ahead, as the global energy transition continues to accelerate, GE Vernova’s Electrification segment remains well-positioned to sustain its growth momentum, backed by steady demand for its grid equipment, particularly in North America and Asia.

Other Stocks’ Activities Reflect Industry Momentum

Like GE Vernova, companies such as Siemens Energy SMNEY and Eaton Corp. ETN 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.

Notably, Siemens Energy’s Grid Technologies business segment, which develops and provides solutions for the transmission and distribution of electrical power, with a strong emphasis on integrating renewable energy sources and enhancing grid resilience, registered a solid year-over-year revenue increase of 33.7% and order growth of 41.6% for second-quarter fiscal 2025. On the other hand, its Siemens Gamsea unit, which manufactures wind turbines, recorded order growth of 51.9% and revenue increase of 18.4%. 

On the other hand, Eaton’s Electrical Americas segment recorded a year-over-year sales improvement of 12% for the first quarter of 2025, while the Electrical Global segment registered 7% sales growth. Notably, ETN’s electrical products help utilities generate, transmit and distribute power, with solutions ranging from circuit breakers to switchgear to machine controls.

The Zacks Rundown for GEV

Shares of GE Vernova have surged a solid 211.6% in the past year, outperforming the industry’s 53.6% gain.

From a valuation standpoint, GEV is currently trading at a forward 12-month price-to-earnings (P/E) of 56.25X, representing a roughly 165.1% premium compared to the industry average of 21.21X.

The Zacks Consensus Estimate for GEV’s 2025 and 2026 sales suggests a year-over-year improvement of 6.4% and 10%, respectively. The bottom-line estimate for 2025 has moved south over the past 60 days, while the same for 2026 has moved north. 

GEV currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. 

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research