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Nextpower Inc (NXT)
NASDAQ:NXT
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Nextpower Inc
(NASDAQ:NXT)
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Rating:80Outperform
Price Target:
$138.00
▲(15.64% Upside)
Action:DowngradedDate:01/29/26
The score is driven primarily by strong financial quality (high margins, strong returns, zero debt) and a bullish earnings update with raised FY2026 guidance and strong cash generation. Technicals also support the rating due to strong trend/momentum, though overbought indicators add near-term risk. Valuation is the main drag given the elevated P/E and no dividend yield support.
Positive Factors
Balance Sheet Strength
A zero-debt balance sheet materially reduces refinancing and interest-rate risk, giving the company durable financial flexibility to fund capex, JV expansion, or opportunistic M&A while supporting customer and supplier confidence over the next several quarters.
Cash Generation Quality
Sustained operating and free cash flow provides predictable funding for organic growth, factory builds, R&D and the $500M buyback without relying on debt. High FCF relative to earnings supports long-term reinvestment and capital allocation flexibility.
Global Expansion and Backlog
Localization via the Saudi JV and large project awards build durable, regional manufacturing scale and a deeper addressable market. Record backlog and new country wins should smooth future shipments and support multi-year revenue visibility.
Negative Factors
Tariff-Related Margin Pressure
Persistent and rising tariff impacts structurally compress gross margins and introduce uncertainty into multi-quarter margin planning. Continued trade-policy headwinds can erode pricing power and make margin sustainability more volatile.
U.S. Revenue Concentration
Heavy dependence on the U.S. market leaves revenues exposed to U.S. policy, permitting cycles, and tariff shifts. Geographic concentration increases systemic risk and limits the company’s ability to offset regional slowdowns or policy-driven disruptions.
Project Timing & Permitting Risk
Project timing and permitting variability create lumpy revenue recognition, working-capital swings and inconsistent cash conversion. That structural execution risk complicates forecasting and can compress short-to-medium term cash flow despite healthy underlying demand.
Nextpower Inc (NXT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$18.48B
Dividend YieldN/A
Average Volume (3M)2.12M
Price to Earnings (P/E)29.6
Beta (1Y)1.24
Revenue Growth20.37%
EPS Growth3.46%
CountryUS
Employees1,300
SectorTechnology
Sector Strength88
IndustryConsumer Electronics
Share Statistics
EPS (TTM)1.10
Shares Outstanding148,475,850
10 Day Avg. Volume1,767,041
30 Day Avg. Volume2,118,262
Financial Highlights & Ratios
PEG Ratio-1.12
Price to Book (P/B)3.72
Price to Sales (P/S)2.04
P/FCF Ratio9.73
Enterprise Value/Market Cap0.91
Enterprise Value/Revenue4.65
Enterprise Value/Gross Profit14.35
Enterprise Value/Ebitda21.67
Forecast
1Y Price Target
$119.73Price Target Upside0.33% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering17
EPS Forecast (FY)4.36
Revenue Forecast (FY)$3.50B
Nextpower Inc Business Overview & Revenue Model
Company DescriptionNextracker Inc., an energy solutions company, provides solar tracker solutions for PV projects. The company offers solar trackers, such as Bifacial PV modules for large-scale solar; NX Horizon for solar power plants; NX Gemini two-in-portrait solar tracker that optimizes lifetime value and performance of power plants for project developers and asset owners; and NX Horizon XTR, an all-terrain solar tracker. It also provides TrueCapture, an intelligent and self-adjusting tracker control system for PV power plants; and NX Navigator, an operational control and risk mitigation software. The company was incorporated in 2013 and is based in Fremont, California. Nextracker Inc. operates as a subsidiary of Flex Ltd.
How the Company Makes MoneyNEXTracker generates revenue primarily through the sale and leasing of its solar tracking systems to utility-scale solar project developers and operators. The company earns money from several key revenue streams, including the direct sale of solar trackers, installation services, and ongoing maintenance and support contracts. Additionally, NEXTracker benefits from strategic partnerships with major solar developers and energy companies, which can lead to bulk orders and long-term contracts. The company also explores opportunities in software solutions that enhance the efficiency of solar operations, contributing further to its revenue. Overall, its strong market position and commitment to technological advancements in solar energy play a critical role in driving its earnings.
Nextpower Inc Earnings Call Summary
Earnings Call Date:Jan 27, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:May 20, 2026
Earnings Call Sentiment Positive
The call presented strong operational and financial momentum: robust revenue and EBITDA growth, record backlog/bookings commentary, excellent cash generation, a clean balance sheet and the milestone investment-grade rating. Management highlighted meaningful product and geographic expansion (new JV in Saudi Arabia, Europe expansion, bundled product wins and power conversion pilots) and raised fiscal 2026 guidance. Headwinds cited were manageable but tangible: rising tariff impacts ($44M), U.S. concentration (81% of Q3 revenue), project timing variability and limited disclosure on some booking/attach details. On balance, positives materially outweigh the negatives.Q3-2026 Updates
Positive Updates
Revenue Growth
Q3 revenue of $909 million, up 34% year-over-year; fiscal year-to-date revenue of $2.68 billion, up 32% year-over-year. Company raised FY2026 revenue guidance to $3.425–$3.5 billion.
Adjusted EBITDA and Margins
Q3 adjusted EBITDA of $214 million, up 15% year-over-year, representing a 23% adjusted EBITDA margin. Fiscal YTD adjusted EBITDA increased 22% year-over-year. FY2026 adjusted EBITDA guidance raised to $810–$830 million; gross margins expected in the low 30s and operating margins in the low 20s.
Strong Cash Generation and Balance Sheet
Q3 operating cash flow of $123 million and adjusted free cash flow of $119 million; fiscal YTD operating cash flow $391 million and adjusted free cash flow $360 million. Ended quarter with $953 million cash and cash equivalents and no debt.
Investment-Grade Credit Rating
Nextpower achieved a formal investment-grade credit rating for the first time as a pure-play solar product company, cited as enhancing customer/supplier confidence and financial flexibility.
Backlog, Bookings and Geographic Demand
Management reported record backlog growth (previously referenced >$5 billion by analysts), with particularly strong bookings and a large, diversified backlog that supported an upward outlook. Europe had record quarterly bookings and expanded into two new countries.
U.S. Market Strength
U.S. bookings up and U.S. revenue increased 63% year-over-year in the quarter. The U.S. accounted for 81% of Q3 revenue (75% YTD), with strong demand for domestically manufactured systems and flight-to-quality dynamics benefiting the company.
Product and Technology Momentum
Continued traction for NX Horizon Hail Pro (2,170 hail stows in CY2025 with <0.007% module breakage), growing adoption of bundled solutions (example: 552 MW order including tracker, eBOS, Earth Truss, TrueCapture), and progress on power-conversion solutions with customer pilots planned in 2026.
Strategic Expansion and JV Execution
Launched Nextpower Arabia joint venture with Abunayyan Holding; already supplying 2.25 GW to a major utility-scale project, operating an existing Riyadh factory and constructing a Jeddah facility. JV positioned to support localization and up to 12 GW annual manufacturing potential over time.
Capital Allocation and Share Repurchase Authorization
Board authorized a share repurchase program up to $500 million over three years while maintaining stated priorities of organic investment and disciplined M&A.
Negative Updates
Tariff-Related Margin Pressure
Tariff impact increased to $44 million in the quarter (from $33 million the prior quarter) due to the effective date timing, and management expects tariff-related margin pressure to remain a manageable headwind but persistent.
Concentration Risk in U.S.
Geographic concentration rose in Q3 with 81% of revenue from the U.S., increasing exposure to U.S. policy, permitting timelines and tariff dynamics.
Project Timing Variability and Permitting Risk
Management noted some projects accelerating while others pushed out; permitting uncertainty (including federal land permit freezes) remains a risk although several previously stalled federal projects have begun to move forward.
Limited Granularity on Bookings and Attach Rates
Management declined to disclose specific Q3 bookings figures (analyst questions implied bookings maybe >$1 billion) and did not provide attach-rate percentages for non-tracker products; non-tracker revenue is still a small base and detailed margin/profitability for bundles remains unspecified.
Blended Margin Dynamics / IRA & Tariff Interaction
There is some complexity in margin drivers: IRA credit dynamics, tariffs and pricing blends can create quarter-to-quarter noise. CFO noted tariffs increased quarter-over-quarter and IRA credits are roughly in line, creating mixed short-term margin impacts.
Company Guidance
Nextpower raised its fiscal 2026 outlook, now expecting revenue of $3.425–$3.50 billion, adjusted EBITDA of $810–$830 million and adjusted diluted EPS of $4.26–$4.36, with gross margins expected in the low‑30s and operating margins in the low‑20s (assuming current U.S. policy and permitting timelines). The upgrade follows a strong Q3 and year‑to‑date performance — Q3 revenue was $909 million with adjusted EBITDA of $214 million (23% margin) and fiscal YTD revenue of $2.68 billion — plus robust cash generation (Q3 operating cash flow $123 million, YTD $391 million; adjusted free cash flow Q3 $119 million, YTD $360 million), a $953 million cash balance with no debt, a record backlog and an announced $500 million share buyback authorization over three years; management noted tariffs pressured margins by $44 million in the quarter (vs. $33 million prior) but expects tariff headwinds to remain manageable.Nextpower Inc Financial Statement Overview
Summary
Strong profitability (TTM ~33% gross margin, ~17% net margin) and robust returns alongside an exceptionally conservative balance sheet (zero debt, strong ROE). Offsets are decelerating revenue growth versus prior years and some variability in cash conversion/FCF momentum (TTM FCF slightly down ~2.4%).Income Statement
TTM (Trailing-Twelve-Months) revenue of ~$3.60B is up ~6.8%, extending a multi-year growth trend. Profitability is strong for the category, with ~33% gross margin and ~17% net margin in TTM, and operating profitability around ~21–22% (EBIT/EBITDA margins). A key weakness is that growth has decelerated versus the much higher growth rates posted in prior years, suggesting tougher comps and a maturing trajectory.86
Very Positive
Balance Sheet
The balance sheet is exceptionally conservative: TTM shows zero debt and a debt-to-equity ratio of 0, reducing refinancing and interest-rate risk. Equity has improved materially from earlier periods (including a year with negative equity), and return on equity is strong in TTM (~34%), indicating efficient profit generation on the current capital base. The main watch-out is the company’s history of large equity volatility in earlier years, which can signal prior recapitalization or large one-time items.91
Very Positive
Cash Flow
Cash generation is solid: TTM operating cash flow is ~$631M and free cash flow is ~$589M, with free cash flow running at ~93% of net income—generally good earnings quality. However, free cash flow growth is slightly negative in TTM (~-2.4%), and cash conversion is not consistently strong across periods (operating cash flow relative to net income is below 1 in the data provided), implying working-capital swings and some volatility in turning profits into cash.78
Positive
| Breakdown | TTM | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.60B | 2.96B | 2.50B | 1.90B | 1.46B | 1.20B |
| Gross Profit | 1.17B | 1.01B | 691.64M | 286.97M | 147.03M | 231.98M |
| EBITDA | 773.78M | 652.52M | 591.48M | 174.55M | 90.00M | 175.34M |
| Net Income | 592.07M | 509.17M | 306.24M | 118.89M | 50.91M | 124.35M |
Balance Sheet | ||||||
| Total Assets | 3.80B | 3.19B | 2.52B | 1.42B | 1.02B | 880.97M |
| Cash, Cash Equivalents and Short-Term Investments | 952.62M | 766.10M | 474.05M | 130.01M | 29.07M | 217.99M |
| Total Debt | 0.00 | 0.00 | 147.72M | 150.55M | 7.20M | 7.50M |
| Total Liabilities | 1.65B | 1.56B | 1.53B | 934.82M | 516.16M | 424.92M |
| Stockholders Equity | 2.15B | 1.63B | 961.01M | -3.08B | 501.13M | 456.05M |
Cash Flow | ||||||
| Free Cash Flow | 589.26M | 621.87M | 422.31M | 104.49M | -153.03M | 91.31M |
| Operating Cash Flow | 630.80M | 655.79M | 428.97M | 107.67M | -147.11M | 94.27M |
| Investing Cash Flow | -175.90M | -186.10M | -6.66M | -3.16M | -5.75M | -2.96M |
| Financing Cash Flow | -195.82M | -177.65M | -78.27M | -3.57M | -8.66M | 96.33M |
Nextpower Inc Technical Analysis
Positive
119.34
Price Trends
101.93
Positive
96.24
Positive
78.66
Positive
Market Momentum
5.11
Positive
57.15
Neutral
48.49
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NXT, the sentiment is Positive. The current price of 119.34 is above the 20-day moving average (MA) of 116.86, above the 50-day MA of 101.93, and above the 200-day MA of 78.66, indicating a bullish trend. The MACD of 5.11 indicates Positive momentum. The RSI at 57.15 is Neutral, neither overbought nor oversold. The STOCH value of 48.49 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NXT.
Nextpower Inc Risk Analysis
Nextpower Inc disclosed 55 risk factors in its most recent earnings report. Nextpower Inc reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Nextpower Inc Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $18.48B | 29.65 | 33.29% | ― | 20.37% | 3.46% | |
67 Neutral | $1.80B | 51.41 | 5.86% | ― | 2.68% | 2.90% | |
62 Neutral | $6.04B | 34.28 | 17.93% | ― | 20.97% | 226.98% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
61 Neutral | $1.79B | -17.94 | -7.75% | ― | 35.75% | 37.97% | |
60 Neutral | $2.10B | -5.08 | -74.68% | ― | -0.14% | 66.71% | |
45 Neutral | $1.33B | 82.98 | 0.56% | ― | -4.46% | 1645.26% |
* Technology Sector Average
NXT
Nextpower Inc
119.34
72.64
155.55%
CSIQ
Canadian Solar
20.05
9.26
85.82%
ENPH
Enphase Energy
46.56
-19.52
-29.54%
SEDG
SolarEdge Technologies
37.90
19.44
105.31%
ARRY
Array Technologies
11.23
4.54
67.86%
SHLS
Shoals Technologies Group
10.61
6.13
136.83%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.