Al Root

GE Vernova stock rose early Wednesday as President Donald Trump's trip to Saudi Arabia drummed up some new business and a higher Wall Street price target.

Shares of the power technology company were up 1.1% in early trading at $438.27, while the S&P 500 and Dow Jones Industrial Average were up 0.2% Wednesday.

On Tuesday, Trump announced initiatives worth up to $14.2 billion for GE Vernova equipment. Included in the amount is $2 billion already in the backlog, with future contracts and memorandums of understanding spanning the coming four years. GE Vernova's equipment -- which includes gas-powered turbines, windmills, and electricity grid technology -- will help Saudi Arabia transition to net-zero carbon emissions by 2060.

"As the world's energy equipment manufacturer, GE Vernova is proud to deploy world-class technology to help deepen the longstanding relationship between the U.S. and the Kingdom of Saudi Arabia," said GE Vernova CEO Scott Strazik in a news release. "We are committed to continuing our work to grow capacity and jobs in the U.S. and beyond to meet these critical needs."

New business is always welcome. Even better, this comes when sales are growing, and the outlook is bright. Vernova is expected to generate revenue of about $37 billion in 2025 and $40 billion in 2026, according to FactSet.

"The Middle East has been the main driver of gas turbine capacity additions for GE Vernova in recent years, driven by accelerating [electricity] load growth expectations in the region," wrote Susquehanna analyst Charles Minervino in a Wednesday report. "GE Vernova had already begun booking orders in the 2029/2030 time frame as it is largely sold out of capacity through 2028, and new order announcements should support backlog visibility."

He also noted that Trump's tax bill, which repeals some clean energy credits, was "not as bad as feared." Investment tax credits will be phased out between 2029 and 2031. Minervino rates GE Vernova shares Buy and increased his price target to $499 from $399 a share.

The $100 increase is worth about $27 billion in market value.

Overall, almost 80% of analysts covering GE Vernova stock rate shares Buy, according to FactSet. The average Buy-rating ratio for stocks in the S&P 500 is about 55%. The average analyst price target for Vernova shares is about $419. Minervino's price target is now the highest on Wall Street among large U.S. brokerage firms.

Closing at Wednesday morning levels would represent a new 52-week closing high for the stock. That's an impressive turnaround from March, when Vernova shares fell to about $270 after Chinese AI application DeepSeek sparked fears that developing and running AI applications wouldn't require as much electricity as initially thought.

Write to Al Root at allen.root@dowjones.com

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May 14, 2025 10:15 ET (14:15 GMT)

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