GE Vernova Raises Guidance and Capital Returns Amid Rare Earth Supply Concerns

GE Vernova (GEV) has significantly raised its long-term financial guidance and shareholder returns, while navigating supply chain challenges stemming from China's restrictions on rare earth exports. During its investor day on Tuesday, the company projected its revenue would reach $52 billion by 2028, a substantial increase from its previous estimate of $48 billion and the $34 billion reported in 2024. The adjusted EBITDA margin target was also raised to 20%.

The company's total backlog is expected to grow from the current $135 billion to approximately $200 billion by 2028. This growth is supported by strong demand, with GE Vernova having already signed 18 GW of gas turbine contracts in the current quarter and anticipating that figure to reach 80 GW by year-end.

In response to its robust outlook, the company announced a major boost to capital returns. The quarterly dividend will be doubled to $0.50 per share from $0.25, and the share repurchase authorization has been expanded to $10 billion from $6 billion, of which $3.3 billion has already been utilized. Management expects to generate at least $22 billion in cumulative free cash flow from 2025 through 2028.

A key operational focus addressed by CEO Scott Strazik is the supply of rare earth yttrium. China restricted exports of yttrium and six other rare earths in April 2025, causing prices outside China to surge by 4,400% between January and November. Strazik stated the company has sufficient yttrium inventory to last through 2025 and into 2026 and is working with the U.S. government to boost stockpiles. The company is also investing in alternatives to replace certain rare earths if necessary.

Following the investor day, Bank of America Securities raised its price target for GE Vernova stock from $725 to $804, maintaining a Buy rating. The bank values the stock at 26 times its raised 2027 estimated EBITDA, a premium to the peer average. Despite the positive news, some analysts note valuation concerns, with the stock's forward P/E ratio of 89 significantly higher than the sector median of 20.