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Skip NavigationMarketsBusinessInvestingTechPolitics & PolicyVideoWatchlistInvesting ClubPROLivestreamMenuWall Street is responding on Thursday to news of Amazon’s deal with generator maker Generac with a flood of buy ratings and higher price targets. Generac shares were up more than 19% in Thursday’s midday trading to just under $209 following the announcement of the $2.4 billion supply agreement, which comes with warrants for Amazon to acquire up to 1.7 million shares of Generac. Amazon shares gained about 2%. GNRC 5D mountain GNRC 5 day The deal is a “massive win” for Generac, according to investment bank William Blair, which has an outperform rating on the stock. “Amazon is expected to spend $2.4 billion on Generac generators in 2027 and 2028. For frame of reference, Generac reported total company revenue of $4.2 billion in 2025,” analyst Brian Drab wrote in a Thursday note to William Blair clients. Analysts at Baird called the stock a “top idea,” giving it an outperform rating with a price target of $305. “From previously getting little value ascribed to the DC business, this adds exceptional near-term profit/return contribution, long-term incentives, and durability/multiple on the business,” Michael Halloran at Baird wrote in a Wednesday note. “Stock has runway ahead.” Overly enthusiastic? Some on Wall Street thought the positive reaction following the announcement was overdone. Citi analyst Vikram Bagri said the deal was “substantially larger than expected” but suggested the price-to-revenue multiple of the stock was too high as it surged more than 30% in extended trading. “While the announcement is clearly positive, the after-hours reaction appears to reflect a valuation of roughly 15x the implied ~$1.2B annual revenue at a 20% EBITDA margin, which appears aggressive,” Bagri wrote in a Wednesday note. He has a neutral rating on the stock and a price target of $300. The size of the deal is a positive sign for the status of the private sector computing capacity buildout, which is facing increasing resistance from states and local communities. “The agreement provides strong visibility — with an indication of $8 billion in spend over seven years — for Generac at a time when many investors are questioning the durability of capital spending trends in the data center industry,” Drab said. Buy, outperform and overweight ratings on the stock were held on Thursday by equity researchers at Stephens, William Blair, Baird, Canaccord Genuity, Stifel, Jefferies, Wells Fargo, and Cantor Fitzgerald. Neutral and equal weight ratings were held by Barclays, Guggenheim and Citi.Read More