Key Takeaways
- GEV shares plunged 8.6% Monday, closing at $874.66, significantly worse than the S&P 500’s 0.5% decline
- Leading AI executives including Anthropic’s Dario Amodei advocated for pausing rapid AI advancement
- Gordon Johnson of GLJ Research launched coverage with a Sell rating and $470 price target, the lowest on Wall Street
- Johnson’s Ebitda projection for 2027 stands at $7.4B, substantially below the FactSet consensus forecast of $9.5B
- Fellow infrastructure suppliers Eaton and Vertiv experienced similar declines of approximately 7.6%
Shares of GE Vernova tumbled 8.6% during Monday’s trading session, September 14, finishing at $874.66. This marked a significant underperformance compared to the broader market, where the S&P 500 slipped just 0.5% and the Nasdaq Composite retreated 0.6%.
The sharp decline resulted from a double whammy: escalating concerns about the future pace of artificial intelligence development and a strikingly bearish analyst initiation suggesting shares could fall by approximately 50%.
The AI-related anxiety originated from a published essay by Dario Amodei, CEO of Anthropic, who contended that artificial intelligence technology is progressing more rapidly than the industry’s ability to safely manage it. Amodei advocated for decelerating frontier AI development and suggested placing independent safety auditors within AI research facilities.
Sam Altman of OpenAI, entrepreneur Elon Musk, and Demis Hassabis from Google DeepMind each expressed varying degrees of support for these proposals.
This development carries significant implications for GEV, as the company’s power generation equipment segment depends heavily on demand from AI-powered data centers. Any deceleration in AI advancement would correspondingly reduce requirements for the electrical infrastructure solutions that GE Vernova provides.
Prior to Monday’s selloff, GEV had climbed 46% year-to-date in 2026 and had surged an impressive 324% over the preceding 24-month period.
Bearish Analyst Initiation Compounds Pressure
Adding to the broader market headwinds, Gordon Johnson from GLJ Research initiated coverage on GE Vernova with a Sell recommendation and established a $470 price objective. This target represents approximately a 50% discount from Monday’s trading levels and sits more than $300 beneath the second-lowest analyst forecast on the Street.
Johnson’s primary concern centers on valuation metrics. GEV currently trades at approximately 26 times his projected 2027 Ebitda figure. By comparison, the broader S&P 500 trades around 13 times. Johnson assigns the company a valuation multiple of 14 times based on his proprietary Ebitda forecast.
Additionally, Johnson anticipates earnings will disappoint consensus expectations, partially because power generation turbines scheduled for 2027 delivery were contracted when pricing was less favorable. His 2027 Ebitda forecast of $7.4 billion stands in stark contrast to the FactSet consensus estimate of $9.5 billion.
Johnson’s perspective represents a significant deviation from Wall Street consensus. Approximately 80% of analysts tracking GEV maintain Buy ratings, compared to the standard S&P 500 Buy-rating percentage of 55% to 60%. The consensus price target hovers around $1,240.
Broader Sector Weakness
GEV’s decline wasn’t isolated. Eaton and Vertiv, both providers of electrical infrastructure components for AI-related facilities, each dropped approximately 7.6% during Monday’s session.
The selloff occurred mere days after Jefferies analyst Julien Dumoulin-Smith elevated his GEV price objective to $1,185 from $1,155 on Friday. He highlighted expanding service revenue streams from a growing installed turbine base, which propelled shares up 3.6% during that session.
The consensus analyst price target for GE Vernova continues to hover around $1,240, substantially above both Monday’s closing price and Johnson’s contrarian $470 forecast.
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