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Recent Articles
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Clean Energy Idea GE Vernova Reaffirms 2024 Guidance
Oct 24, 2024
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Image: GE Vernova shares have powered higher as of late.
GE Vernova reaffirmed its 2024 financial guidance, with revenue now trending towards the higher end of the range of $34-$35 billion, adjusted EBITDA margin of 5%-7%, and free cash flow of $1.3-$1.7 billion, also now trending towards the higher end of the free cash flow range. In Power, the company expects mid-single-digit organic revenue growth and 150-200 basis points of organic segment EBITDA margin expansion. In Wind, the company expects flat organic growth, and it expects material segment EBITDA improvement. In Electrification, the company now expects high teens organic revenue growth, up from prior guidance of mid-to-high teens.
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Tesla’s Margins, Free Cash Flow Swell in Third Quarter
Oct 23, 2024
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Image: Tesla has returned to a free cash flow rich entity.
Tesla reported solid third quarter results that showed a business that is getting back on track. Not only did production and deliveries increase nicely on a year-over-year basis, but the firm’s margin improvement is a sight to see and comes in the wake of lowered vehicle selling prices. Tesla also showcased its cash generation capacity in the quarter, with free cash flow more than tripling. We like Tesla’s net-cash-rich balance sheet, its free cash flow generation, and its ability to drive growth, but we fall short of including shares in any newsletter portfolio.
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NextEra Energy Reaffirms Outlook
Oct 23, 2024
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Image: NextEra Energy’s shares have bounced back nicely from their October 2023 lows.
NextEra Energy reaffirmed its outlook, which we like quite a bit. This year, NextEra Energy continues to expect adjusted earnings per share in the range of $3.23-$3.43. For 2025, 2026, and 2027, the company expects adjusted earnings per share in the ranges of $3.45-$3.70, $3.63-$4.00 and $3.85-$4.32, respectively. NextEra Energy also continues to expect to grow its dividends per share at roughly a 10% rate per year through at least 2026, off a 2024 base. We like NextEra Energy as a core holding in the ESG Newsletter portfolio.
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Boeing Burning Through Cash
Oct 23, 2024
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Image: Boeing’s shares have seen better days.
The big red flag with Boeing is its cash flow performance. The aerospace giant burned through $1.3 billion in operating cash flow in the third quarter due to lower commercial widebody deliveries and unfavorable working capital timing, and after factoring in capital spending of $611 million in the period, cash burn in terms of negative free cash flow was roughly $2 billion in the quarter. Through the first nine months of the year, Boeing has burned through over $10.2 billion in free cash flow. Boeing’s balance sheet isn’t as strong as it once was either, with $10.5 billion in cash and marketable securities versus consolidated debt of $57.7 billion. Inventories swelled to $83.3 billion at the end of its September quarter versus $79.7 billion at the end of last year. The company does have $20 billion undrawn on its credit facilities, however. We don’t think Boeing is a top idea for investors, but we do like its total company backlog of $510.5 billion, which includes over 5,400 commercial airplanes. We prefer Honeywell as our top aerospace idea and Lockheed Martin as our top defense play.
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