Nextracker Inc (NASDAQ:NXT) Presents a Compelling Case for Affordable Growth Investors

Investors looking for growth chances at fair prices often use the "Affordable Growth" method, which focuses on companies showing good expansion possibility without high costs. This method screens for stocks with good growth paths, firm profitability, and sound financial bases while making sure they stay fairly priced. By weighing these core elements, the method tries to find companies set for lasting growth without the high prices that usually come with strong-growth tales.

Growth Path

Nextracker Inc (NASDAQ:NXT) shows good growth traits that fit well with affordable growth standards. The company's past results show large growth in important financial measures:

• Earnings Per Share has risen by 22.25% over the last year, with a notable 32.95% average yearly growth rate over recent years
• Revenue went up by 20.37% in the last year, keeping steady yearly growth at close levels
• Future revenue growth forecasts stay good at 11.57% per year, though earnings growth is predicted to slow to 7.36%

While the growth pace shows some slowing from past highs, the company keeps better-than-average growth that warrants investor notice. The steady double-digit revenue growth points to a firm market stand in the solar tracking field, giving a sound base for ongoing growth.

Valuation Check

The valuation view shows a mix of relative affordability and higher-tier placement. Nextracker's current valuation numbers indicate:

• Price/Earnings ratio of 21.99, trading under the industry average of 39.27 and about level with S&P500's 26.76
• Price/Forward Earnings of 22.22, less expensive than 79% of industry rivals
• Enterprise Value to EBITDA ratio placed cheaper than 79% of competitors
• Price/Free Cash Flow ratio more appealing than 86% of industry firms

The valuation score of 5/10 shows this mixed view, while not low-priced, the company trades at fair levels compared to both industry peers and wider market indexes. For growth-focused investors, this is a reachable starting point compared to many high-growth tech firms with high prices.

Profitability Standing

Nextracker does well in profitability measures, reaching a high-level score of 9/10 that shows working efficiency:

• Return on Assets of 15.70% does better than 97% of industry rivals
• Return on Equity of 29.01% puts the company in the top 5% of the electrical equipment field
• Operating Margin of 21.17% sits with the industry's best at nearly the 99th percentile
• Profit Margin of 17.08% beats 93% of peer firms

These high profitability numbers give key safety for growth investors, as very profitable companies usually show more strength in market drops and have more means to fund continued growth.

Financial Soundness Points

With a health score of 6/10, Nextracker keeps acceptable financial steadiness though with some points to watch:

• No long-term debt places the company well against rivals with debt
• Current Ratio of 2.18 shows good short-term cash flow, doing better than 63% of industry peers
• Quick Ratio of 1.98 shows solid immediate cash flow, better than 75% of competitors
• The company has raised shares outstanding in recent years, showing a small worry for current shareholders

The balance sheet with no debt gives good room for strategic moves and handles possible economic challenges, while the cash flow measures ensure working steadiness.

Investment Points

Nextracker offers a good case for affordable growth investors looking for a place in the renewable energy infrastructure field. The company mixes better-than-average growth rates with fair valuation multiples and high profitability, a mix that fits well with growth-at-fair-price goals. The firm market spot in solar tracking systems, along with worldwide growth chances, gives growth sight, while the balance sheet with no debt provides financial steadiness.

The full fundamental analysis report gives more detail for investors doing more homework.

For investors keen on finding like affordable growth chances, more screening results can be seen using the Affordable Growth Stock Screener, which finds firms meeting like growth, valuation, profitability, and health standards.

Disclaimer: This study is based on fundamental data and scores from ChartMill.com and shows a neutral check of the company's financial numbers. This information is for learning only and should not be seen as investment guidance or a suggestion to buy, sell, or hold any securities. Investors should do their own study and talk with financial advisors before making investment choices. Past results do not ensure future outcomes.