Balanced Outlook for NEXTracker, Inc.: Strong Market Position and Strategic Acquisitions Offset by Margin Concerns and Policy Uncertainties

BMO Capital analyst Ameet Thakkar maintained a Hold rating on NEXTracker, Inc. Class A yesterday and set a price target of $71.00.

Ameet Thakkar’s rating is based on a combination of factors that highlight both positive developments and potential challenges for NEXTracker, Inc. Class A. The company has shown a strong market position in the solar tracker industry, evidenced by its raised FY 2026 EBITDA and EPS guidance, which indicates a positive outlook for the fiscal year. Additionally, NEXTracker’s strategic acquisitions in robotics and AI are expected to bolster long-term EBITDA growth, even with conservative assumptions about average selling prices and geographic shifts.
However, Thakkar remains cautious due to certain concerns. Despite the impressive backlog growth, there were initial investor concerns about its size compared to expectations. Furthermore, the decline in gross margins is attributed to changes in product mix, which could impact profitability. Additionally, while global demand for solar tracking equipment is expected to remain strong, there are uncertainties regarding tracker average selling prices and potential slowdowns in solar capacity growth due to policy uncertainties in the U.S. These factors contribute to the Hold rating, reflecting a balanced view of the company’s prospects.

In another report released today, TD Cowen also maintained a Hold rating on the stock with a $65.00 price target.