1 Wall Street analyst just gave GE Vernova stock an initial buy rating. Is it time to buy?

General ElectricGavinovafirms(NYSE: GEV)Last week, the company completed the sale of its shares from its parent company General Electric (now known asGeneral Electric AerospaceInc.) spin-off, at least one analyst seems to be more bullish on the prospects for the new company.JPMorganAnalyst Mark Strouse, who began analyzing the global energy company by telling clients to wait to hold the stock, has just issued his first rating upgrade on the spinoff, where it amounts to a buy rating.

Strouse has set a $141 price target on shares of General Electric Vernova. With the stock currently trading at around $133, Strouse's price target implies a potential upside of around 6% over the next 12 months or so.

Strauss was quick to raise its target price, likely due to the stock's downward trend in its first week of trading. For spin-offs like GE Vernova, it also takes some time to digest the details and the new financials.

Each record holder of General Electric (GE) common stock will receive one share of GE Vernova Corporation on March 19, 2024 for every four shares of GE common stock held. However, investors will now be required to value GE Vernova based on the value of the GE Vernova business itself, without regard to the status of the former GE parent company.

This means believing in General Electric Vernova's vision of a clean energy transition for the world's children. Scott Strazik, Chief Executive Officer of GE Vernova, put the investment case succinctly in his March 2024 investor presentation, saying, "The energy transition is the next investment super-cycle.

Strouse believes this is a good time to invest in GE Vernova from a valuation standpoint. Based on the company's sales forecast for this year, the current price-to-sales (P/S) ratio is just 1. Excluding potential acquisitions, management expects at least mid-single-digit annual sales growth over the next few years. This makes a compelling case for investing at near-term levels.

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1 Wall Street analyst just gave General Electric Vernova stock an initial buy rating. Is it time to buy? This post was originally published by The Motley Fool.