NEXTracker's International Growth Prospects Remain Strong Despite Share Price Discount, Analyst Predicts

Truist Financial analyst Jordan Levy maintained a Buy rating on NEXTracker, Inc NXT.

Nextracker announced the pricing of a follow-on offering of ~18.2 million shares by selling shareholders at $36.50 per share last week, representing a ~6% discount to the stock's closing price on June 23. Given that the shares were already accounted for in his estimates, there is minimal change to the analyst's go-fwd forecast and valuation for NXT. Levy remains bullish on NXT's U.S. and international growth prospects amidst accelerating utility-scale solar development, with potential future earnings/EBITDA upside on the back of the IRA's tracker-specific manufacturing tax credits. 

The analyst adjusted his estimates. He currently forecasts 1Q24 revenues & EBITDA of $471 million and $60 million, respectively, vs. Street estimates of $472 million & $58 million, respectively.

The price target reflects a forward 14x multiple (14x prior) applied to his calculated 2025E EBITDA of $455 million (earlier $455 million).

Price Action: NXT shares traded lower by 1.93% at $38.67 on the last check Wednesday.