Nextpower Inc. Class A Common Stock (NXT)

FairStock Score: 65/100 — STEADY

Key Financials

Strengths

• Generates $454 million in annual free cash flow (2.4% yield on market cap)
• High return on equity of 33.2% demonstrating efficient capital deployment
• Conservative balance sheet with debt-to-equity of just 0.02, providing financial flexibility
• Altman Z-Score of 6.8 confirms minimal bankruptcy risk and strong solvency
• Revenue growth of 33.9% demonstrates strong top-line momentum

Concerns

• Trades significantly above Graham Number ($36) with negative 251% margin of safety—limited downside protection
• Weak Piotroski F-Score of 3/9 suggests deteriorating financial quality across multiple dimensions

AI Analysis

Nextpower Inc. Class A Common Stock is a mid-cap technology company valued at $18.6 billion. The business generates $3.6 billion in annual revenue with a 3.6% net margin and $454 million in free cash flow. From a quality standpoint, Nextpower shows weak Piotroski F-Score of 3/9 signaling deteriorating fundamentals and Altman Z-Score of 6.8 confirms fortress-level solvency. On valuation, the stock is trading at a premium 31.7x earnings, with trades far above its Graham Number ($36) with no margin of safety. Growth dynamics show revenue growing at 33.9% and profit growth of 13.8%. Our composite FairStock Score of 65/100 reflects above-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

Nextpower's 34% revenue growth trajectory could accelerate as it captures additional market share in the technology sector. With $454 million in annual free cash flow (2.4% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

At 32x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer