Nextpower (NXT) Raises Its 2027 Outlook, Is The Stock Still Cheap?

Nextpower (NXT) hit investors’ radar after raising the lower end of its fiscal 2027 outlook, following first quarter earnings that topped estimates and highlighted confidence in converting its multi year project backlog.

Despite the upgraded outlook, Nextpower’s recent share price performance has been mixed. The stock is down about 19% over the past 90 days, and the year-to-date share price return is lower by around 10%. This contrasts with the three-year total shareholder return of about 142%, which points to much stronger longer-term momentum.

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Nextpower appears to be a solid solar technology platform with revenue of US$3.63b and net income of US$594m, yet the share price has retreated sharply in recent months. Is that strength already fully reflected in today’s valuation?

Most Popular Narrative: 40% Undervalued

At a last close of $83.45 versus a narrative fair value of about $138.96, Nextpower is framed as trading at a steep discount, with that gap hinging on how investors view its broader solar, storage and inverter platform.

The main thing that has to go right is Nextpower successfully scaling its newer storage, inverter and non tracker offerings so that the higher margin mix and larger installed base offset project delays, interconnection bottlenecks and any future guidance disappointments.

The current valuation implies the market is discounting Nextpower’s record backlog, margin performance and raised guidance after the roughly 32% share price decline. This leaves the stock pricing in a more cautious outlook than the company’s recent numbers and order book would suggest.

See why 65 investors see Nextpower as 40% undervalued.

Result: Fair Value of $138.96 (UNDERVALUED)

Still, the narrative can quickly wobble if interconnection delays slow that US$5.5b plus storage backlog, or if further earnings and EBITDA misses chip away at confidence in Nextpower’s expansion plan.

Find out about the key risks to this Nextpower narrative.

Next Steps

If you feel uncertain about Nextpower due to the mixed sentiment, move quickly from headline impressions to hard evidence by reviewing the 4 key rewards and 1 important warning sign.

Looking for more investment ideas beyond Nextpower?

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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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