NASDAQ:NXT is not too expensive for the growth it is showing.

Last update: Jan 9, 2025

Our stock screener has spotted NEXTRACKER INC-CL A (NASDAQ:NXT) as a growth stock which is not overvalued. NASDAQ:NXT is scoring great on several growth aspects while it also shows decent health and profitability. At the same time it remains remains attractively priced. We'll dive into each aspect below.

A Closer Look at Growth for NASDAQ:NXT

ChartMill assigns a proprietary Growth Rating to each stock. The score is computed by evaluating various growth aspects, like EPS and revenue growth. We take into account the history as well as the estimated future numbers. NASDAQ:NXT was assigned a score of 7 for growth:

The Earnings Per Share has grown by an impressive 1791.80% over the past year.
NXT shows a strong growth in Revenue. In the last year, the Revenue has grown by 34.43%.
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.
NXT is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 10.54% yearly.
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.

Valuation Analysis for NASDAQ:NXT

ChartMill assigns a Valuation Rating to each stock, ranging from 0 to 10. This rating is calculated by analyzing different valuation elements, such as price to earnings and free cash flow, both in absolute terms and relative to the market and industry. In the case of NASDAQ:NXT, the assigned 8 reflects its valuation:

The Price/Earnings ratio is 11.13, which indicates a very decent valuation of NXT.
93.18% of the companies in the same industry are more expensive than NXT, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.34. NXT is valued rather cheaply when compared to this.
Based on the Price/Forward Earnings ratio, NXT is valued cheaper than 89.77% of the companies in the same industry.
NXT is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 23.61, which is the current average of the S&P500 Index.
93.18% of the companies in the same industry are more expensive than NXT, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, NXT is valued cheaply inside the industry as 86.36% of the companies are valued more expensively.
The excellent profitability rating of NXT may justify a higher PE ratio.

Understanding NASDAQ:NXT's Health

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 8 out of 10:

NXT has an Altman-Z score of 3.33. This indicates that NXT is financially healthy and has little risk of bankruptcy at the moment.
NXT's Altman-Z score of 3.33 is fine compared to the rest of the industry. NXT outperforms 70.45% of its industry peers.
The Debt to FCF ratio of NXT is 0.34, which is an excellent value as it means it would take NXT, only 0.34 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 0.34, NXT belongs to the top of the industry, outperforming 95.45% of the companies in the same industry.
A Debt/Equity ratio of 0.11 indicates that NXT is not too dependend on debt financing.
The Debt to Equity ratio of NXT (0.11) is better than 62.50% of its industry peers.
A Current Ratio of 2.21 indicates that NXT has no problem at all paying its short term obligations.
NXT has a Current ratio of 2.21. This is in the better half of the industry: NXT outperforms 62.50% of its industry peers.
With a decent Quick ratio value of 1.99, NXT is doing good in the industry, outperforming 78.41% of the companies in the same industry.

Looking at the Profitability

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:

NXT has a Return On Assets of 17.54%. This is amongst the best in the industry. NXT outperforms 98.86% of its industry peers.
Looking at the Return On Equity, with a value of 38.36%, NXT belongs to the top of the industry, outperforming 97.73% of the companies in the same industry.
The Return On Invested Capital of NXT (27.99%) is better than 98.86% of its industry peers.
The Average Return On Invested Capital over the past 3 years for NXT is significantly above the industry average of 10.49%.
The 3 year average ROIC (17.04%) for NXT is below the current ROIC(27.99%), indicating increased profibility in the last year.
With an excellent Profit Margin value of 17.33%, NXT belongs to the best of the industry, outperforming 97.73% of the companies in the same industry.
In the last couple of years the Profit Margin of NXT has grown nicely.
NXT's Operating Margin of 25.56% is amongst the best of the industry. NXT outperforms 98.86% of its industry peers.
NXT's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 36.13%, NXT belongs to the top of the industry, outperforming 81.82% of the companies in the same industry.
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.