“NEXTracker: Solar stock worth noticing, on a budget.”

By Oliver Townsend Jul 4, 2024
NEXTracker (NASDAQ:NXT): Unique, Surprisingly Cheap Solar Stock.jpegOrginal image from: https://www.tipranks.com/news/nextracker-nasdaqnxt-unique-surprisingly-cheap-solar-stock

Investing in solar stocks can be a lucrative opportunity, especially when you find a unique and undervalued company like NEXTracker (NASDAQ:NXT). NEXTracker stands out as a surprisingly cheap solar stock with strong revenue and earnings growth potential, making it an attractive investment within the solar industry. In this article, we will delve into what sets NEXTracker apart, its growth prospects, and why analysts are bullish on its future.

The NEXTracker Advantage

NEXTracker specializes in providing integrated solar tracker and software solutions for industrial- and utility-scale solar generation projects globally. Their products enable solar panels to optimize energy output by tracking the sun’s movements, leading to increased performance and higher energy yields. With a 30% market share and a decade-long leadership position, NEXTracker offers differentiated solutions with numerous patents in its portfolio, setting it apart from competitors.

In Fiscal 2024, NEXTracker reported record revenue and profits, showcasing impressive growth. Revenue grew by 31% to $2.5 billion, while adjusted EBITDA increased by 150% to $521 million. The company’s backlog also tripled to a record $4 billion, indicating rising demand for its products. With the solar industry projected to grow significantly in the coming years, NEXTracker is well-positioned to capitalize on this trend.

Surprisingly Cheap Valuation

What makes NEXTracker particularly appealing is its modest valuation despite its strong growth trajectory. Trading at just 15.5 times forward earnings estimates, NEXTracker is undervalued compared to the broader market. Additionally, the stock boasts a PEG ratio of under 0.4x, indicating favorable valuations for a growth stock. Analysts see significant upside potential for NEXTracker, with a Strong Buy consensus rating and an average price target of $60.47, implying a 27.7% increase from current levels.

Growing Demand and Opportunities

NEXTracker’s CEO, Dan Shugar, envisions a bright future for the company, especially with the increasing demand from data centers powered by solar energy. As artificial intelligence drives the need for more data centers, solar energy is expected to play a crucial role in meeting this demand. With the potential for solar power to generate as much electricity as the entire U.S. power grid by 2030, NEXTracker is poised to benefit from this growth trajectory.

In conclusion, NEXTracker presents a compelling investment opportunity in the solar industry, thanks to its innovative products, robust financial performance, and attractive valuation. With a strong endorsement from analysts and a perfect Smart Score rating, NEXTracker is a stock worth considering for investors looking to capitalize on the renewable energy sector’s growth.

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