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On Friday, Barclays (LON:BARC) analysts initiated coverage on Solaris Energy Infrastructure stock (NYSE: SEI) with an Overweight rating, setting a price target of $42.00, well above the current trading price of $27.13. The company, currently valued at $1.83 billion, has rapidly positioned itself as a prominent supplier of mobile power solutions with a significant capacity in natural gas turbines. According to InvestingPro data, analyst targets range from $32 to $53, suggesting significant upside potential.
In the past year, Solaris has expanded its operations to include 340 MW of natural gas turbine capacity, with plans to increase this by an additional 1,360 MW by 2027. This expansion aligns with the company’s impressive 33.59% revenue growth over the last twelve months. This growth is driven by the increasing demand from planned data centers across the United States, which are facing a power shortage projected to reach 300-400 GW by 2030.
The U.S. grid is expected to add only about 75 GW of industrial power generation over the next five years, prompting hyperscalers to seek off-grid power solutions. These companies are engaging in long-term contracts at premium rates, bolstering the Distributed Power market where Solaris is a key player.
Currently, Solaris has 1,150 MW of capacity secured under contracts lasting between five to six years with a major hyperscaler. The remaining 550 MW of capacity is available on the spot market. Barclays analysts anticipate that Solaris will continue to expand its capacity through additional equipment orders or strategic mergers and acquisitions. With a GOOD financial health score and moderate debt levels, the company appears well-positioned for growth. For deeper insights into SEI’s valuation and 12 additional key investment tips, check out the comprehensive research available on InvestingPro.
In other recent news, Solaris Energy Infrastructure reported a strong performance for Q1 2025, surpassing earnings and revenue forecasts. The company achieved an earnings per share (EPS) of $0.20, beating the expected $0.14, with revenue reaching $126 million, exceeding the anticipated $112.13 million. This marks a continuation of Solaris’ trend of exceeding market expectations, driven by its strategic initiatives and operational efficiencies. Additionally, Citi analysts began coverage of Solaris Energy Infrastructure with a Buy rating, setting a price target at $32.00. The analysts emphasized an optimistic outlook due to the enduring demand for reliable power and Solaris’ strategic position in the utility sector. The company’s significant partnership with an anchor client, involving a joint venture, was highlighted as a strong indicator of long-term capacity utilization. Furthermore, Solaris expanded its data center power generation capacity significantly, and its adjusted EBITDA saw a notable increase. Looking ahead, Solaris projects continued growth in its power solutions segment, with expectations of increased megawatts in the coming quarters.
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