NASDAQ:NXT stands out as a growth opportunity that won't break the bank.

Last update: Oct 15, 2024

Discover NEXTRACKER INC-CL A (NASDAQ:NXT), an undervalued growth gem identified by our stock screener. NASDAQ:NXT is shining in terms of growth metrics, and it's also displaying strong financial health and profitability. What's more, it retains an appealing valuation. We'll break it down further.

How We Gauge Growth for NASDAQ:NXT

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. NASDAQ:NXT has achieved a 8 out of 10:

NXT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 1129.14%, which is quite impressive.
The Revenue has grown by 38.50% in the past year. This is a very strong growth!
Measured over the past years, NXT shows a very strong growth in Revenue. The Revenue has been growing by 30.49% on average per year.
Based on estimates for the next years, NXT will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.73% on average per year.
Based on estimates for the next years, NXT will show a quite strong growth in Revenue. The Revenue will grow by 10.61% on average per year.
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.

Deciphering NASDAQ:NXT's Valuation Rating

ChartMill assigns a proprietary Valuation Rating to each stock. The score is computed by evaluating various valuation aspects, like price to earnings and free cash flow, both absolutely as relative to the market and industry. NASDAQ:NXT was assigned a score of 8 for valuation:

NXT is valuated reasonably with a Price/Earnings ratio of 10.07.
NXT's Price/Earnings ratio is rather cheap when compared to the industry. NXT is cheaper than 89.89% of the companies in the same industry.
NXT is valuated cheaply when we compare the Price/Earnings ratio to 31.73, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 10.28 indicates a reasonable valuation of NXT.
NXT's Price/Forward Earnings ratio is rather cheap when compared to the industry. NXT is cheaper than 87.64% of the companies in the same industry.
NXT is valuated cheaply when we compare the Price/Forward Earnings ratio to 22.71, which is the current average of the S&P500 Index.
NXT's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. NXT is cheaper than 94.38% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, NXT is valued cheaper than 87.64% of the companies in the same industry.
NXT has an outstanding profitability rating, which may justify a higher PE ratio.

Assessing Health Metrics for NASDAQ:NXT

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NASDAQ:NXT has received a 7 out of 10:

NXT has a Altman-Z score of 2.77. This is in the better half of the industry: NXT outperforms 68.54% of its industry peers.
The Debt to FCF ratio of NXT is 0.47, which is an excellent value as it means it would take NXT, only 0.47 years of fcf income to pay off all of its debts.
NXT has a Debt to FCF ratio of 0.47. This is amongst the best in the industry. NXT outperforms 95.51% of its industry peers.
NXT has a Debt/Equity ratio of 0.13. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of NXT (0.13) is better than 61.80% of its industry peers.
NXT has a Current Ratio of 2.11. This indicates that NXT is financially healthy and has no problem in meeting its short term obligations.
The Quick ratio of NXT (1.91) is better than 69.66% of its industry peers.

Evaluating Profitability: NASDAQ:NXT

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NASDAQ:NXT has earned a 9 out of 10:

Looking at the Return On Assets, with a value of 15.51%, NXT belongs to the top of the industry, outperforming 97.75% of the companies in the same industry.
Looking at the Return On Equity, with a value of 36.34%, NXT belongs to the top of the industry, outperforming 97.75% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 28.37%, NXT belongs to the top of the industry, outperforming 98.88% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for NXT is significantly above the industry average of 10.94%.
The 3 year average ROIC (17.04%) for NXT is below the current ROIC(28.37%), indicating increased profibility in the last year.
NXT has a better Profit Margin (14.87%) than 94.38% of its industry peers.
NXT's Profit Margin has improved in the last couple of years.
The Operating Margin of NXT (24.63%) is better than 97.75% of its industry peers.
NXT's Operating Margin has improved in the last couple of years.
NXT has a better Gross Margin (34.19%) than 79.78% of its industry peers.
In the last couple of years the Gross Margin of NXT has grown nicely.

Our Affordable Growth screener lists more Affordable Growth stocks and is updated daily.

For an up to date full fundamental analysis you can check the fundamental report of NXT

Keep in mind

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.