Is Sanmina (SANM) Using Its Houston Factory Bet To Recast Its Energy Infrastructure Role?

• In December 2025, Sanmina Corporation announced a major expansion of its Energy business with a new Houston, Texas factory aimed at the US energy market, capable of producing medium-voltage distribution transformers, instrument transformers and switchgear, with production targeted to begin in 2027 and initial customer commitments already secured.
• By pairing this Houston build-out with a co-design agreement and broader collaboration framework with Koncar - Electrical Industry Inc., Sanmina is deepening its capabilities in medium-voltage transformers while positioning itself as a more integrated supplier for future US energy infrastructure projects.
• We will now examine how the planned Houston energy factory, backed by initial customer commitments, may reshape Sanmina's broader investment narrative.

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Sanmina Investment Narrative Recap

To own Sanmina, you need to believe it can translate complex manufacturing expertise into durable earnings growth while managing integration and execution risks around ZT Systems and geographic expansion. The Houston energy factory looks additive but not a near term catalyst; the key swing factor remains how efficiently Sanmina deploys capital into ZT, working capital, and automation without eroding margins, while customer concentration and potential inventory risk still sit at the top of the risk list.

Among recent announcements, the ongoing share repurchase program stands out alongside this Houston buildout, as it shows management continuing to return capital while still investing heavily in growth initiatives. That combination may appeal to investors who see Sanmina’s expanding North American footprint, including energy infrastructure manufacturing, as complementary to the larger ZT driven data center and AI opportunity set, but it also raises fair questions about capital allocation discipline if execution stumbles.

Yet behind the growth story, investors should be aware of the working capital and inventory exposure that could...

Read the full narrative on Sanmina (it's free!)

Sanmina’s narrative projects $9.7 billion revenue and $375.6 million earnings by 2028.

Uncover how Sanmina's forecasts yield a $190.00 fair value, a 23% upside to its current price.

Exploring Other Perspectives

Three members of the Simply Wall St Community currently estimate Sanmina’s fair value between US$98.49 and US$223.74, underscoring how far apart individual views can be. Set against this wide spread, the pending ZT Systems acquisition and required execution on multiple new facilities could be exactly where your own expectations for future performance either align with, or diverge sharply from, the crowd.

Explore 3 other fair value estimates on Sanmina - why the stock might be worth as much as 45% more than the current price!

Build Your Own Sanmina Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Sanmina research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.
• Our free Sanmina research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Sanmina's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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