Nextracker NXT) delivered another impressive quarter, beating Wall Street's expectations on both earnings and revenue while reinforcing its position as one of the strongest growth stories in the renewable energy sector.
The solar tracking technology leader posted stronger-than-expected results for its fiscal fourth quarter yesterday evening, with NXT spiking 8% in Wednesday’s trading session as investors cheered robust demand, expanding profitability, and an upbeat long-term outlook.
The big question now is whether investors should chase the rally — or wait for a pullback.
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Nextracker’s Stronger-than-Expected Q4 Results
Nextracker reported Q4 2026 revenue of $880.52 million, which was down from $924.34 million a year ago but came in 9% ahead of estimates of $807.33 million.
On the bottom line, Q4 EPS of $1.05 beat expectations of $0.89 per share by nearly 18% despite dropping from $1.29 in a tough to compete against prior year quarter.
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The results capped off another year of strong execution, with Nextracker’s full-year FY26 revenue climbing 20% to $3.56 billion as demand for utility-scale solar projects remained healthy despite a challenging macroeconomic backdrop.
More importantly, Nextracker demonstrated increased profitability with FY26 EPS spiking 27% to $4.50 from $3.54 a share in FY25.
Other highlights included Q4 adjusted EBITDA reaching approximately $202 million on a margin that remained above 20% while free cash flow stayed robust, and the company maintained a debt-free balance sheet with significant cash reserves.
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Nextracker’s Guidance Suggests More Growth Ahead
Sparking the rally was that management also issued FY27 guidance that projects continued growth. Nextracker expects FY27 EPS in the range of $4.21-$4.59 alongside revenue guidance of $3.8 billion-$4.1 billion.
The guidance came in the range of Wall Street’s EPS forecast of $4.59 or 2% growth on revenue of $3.82 billion or 7% growth.
In addition to this, Nextracker unveiled long-term financial targets, including $4.8 billion-$5.6 billion in revenue by FY30, with approximately one-third of revenue expected to come from sales of non-tracker products and services.
Nextracker’s Appealing Acquisitions & Rebranding
Further fueling investor sentiment is that Nextracker announced its expansion into power electronics and energy infrastructure by acquiring Spain-based Zigor Corp, and its U.S. subsidiary, Apex Power, for approximately $80.5 million.
The acquisition is part of Nextracker’s evolution and rebranding into “Nextpower” and is tied to its expansion into power conversion systems (PCS), battery storage, and data center infrastructure.
This comes as Nextracker has begun to reap the benefits of its $70 million acquisition of Bentek Corporation last year, gaining access to Bentek’s expertise in power distribution systems and electrical Balance of System (eBOS) products for the solar industry.
Monitoring NXT’s P/E Valuation
Following the post-earnings rally, Nextracker’s stock now trades at about 32X forward earnings, a clear premium to the Zacks Solar Industry average of 24X.
Notably, solar panel manufacturing leader First Solar FSLR) trades at just 12X forward earnings, although the two companies operate in different parts of the solar value chain.
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Conclusion & Strategic Thoughts
For long-term investors, Nextracker still looks attractive even after the post-earnings surge as the company offers a rare combination of growth and profitability across the renewable energy sector.
That said, investors may want to avoid chasing the stock aggressively after a large one-day rally. Waiting for some consolidation or a broader market pullback could offer a more favorable entry point, with NXT currently landing a Zacks Rank #3 (Hold).
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This article originally published on Zacks Investment Research (zacks.com).