NEXTRACKER INC-CL A (NASDAQ:NXT) – A Potentially Undervalued Stock With Strong Fundamentals

NEXTRACKER INC-CL A (NASDAQ:NXT) was identified by our Decent Value screener as a stock with attractive valuation metrics while maintaining solid financial health, profitability, and growth. The company, which provides solar tracking and software solutions, stands out for its strong fundamentals in a growing renewable energy sector.

Valuation

NXT appears reasonably priced with a Price/Earnings (P/E) ratio of 14.58, below both the industry average (37.34) and the S&P500 (27.46). The Forward P/E of 15.59 also suggests the stock is trading at a discount compared to peers. Additionally, its Enterprise Value to EBITDA and Price/Free Cash Flow ratios are lower than most competitors, reinforcing its undervalued status.

Financial Health

The company has no outstanding debt, a strong Altman-Z score of 4.38 (indicating low bankruptcy risk), and healthy liquidity with a Current Ratio of 2.09. These factors suggest a stable financial position, reducing risk for investors.

Profitability

NXT excels in profitability, with a Return on Equity (ROE) of 31.27% and Return on Invested Capital (ROIC) of 23.95%, both well above industry averages. Its operating margin (21.65%) and profit margin (17.21%) are also among the best in its sector.

Growth

Revenue has grown at an annualized rate of 20.37% over recent years, with earnings per share (EPS) increasing by 32.95% annually. While future EPS growth is expected to moderate, revenue is still projected to grow nearly 10% yearly.

For a deeper look at NXT’s fundamentals, review the full analysis report.

Our Decent Value screener lists more stocks with strong valuations and solid fundamentals.

Disclaimer

This is not investing advice. Always conduct your own research before making investment decisions.