Generac downgraded to Neutral at Janney following 37% advance

As previously reported, Janney Montgomery Scott analyst Sean Milligan downgraded Generac to Neutral from Buy with a $137 fair value estimate, noting that the stock has advanced 37% since the firm’s initiation on December 28. Recent relative outperformance has closed the valuation gap with peers, Generac doesn’t expect to generate free cash flow in Q1 so the firm sees limited near-term buyback potential and guidance for FY23 is significantly weighted to the second half, particularly regarding profitability, the analyst tells investors.