FREMONT, Calif. - Nextpower (NASDAQ:NXT) announced today it has entered into a definitive agreement to acquire Prevalon Energy, a joint venture between Mitsubishi Power Americas and EES, for total consideration of up to $365 million, excluding cash to be acquired, in a combination of cash and stock.
The transaction will add battery energy storage systems and energy management software to Nextpower’s solar power technology platform, according to a press release statement. Prevalon has deployed over 6 GWh of BESS systems globally and holds 1.3 GW of firm supply contracts supporting AI and hyperscaler data center infrastructure deployments.The acquisition comes as Nextpower, with a market capitalization of $20.5 billion, has delivered exceptional returns to shareholders with a 144% gain over the past year and 56% year-to-date performance. The stock currently trades at $137.17, reflecting strong investor enthusiasm for the company’s expansion into energy storage markets.
The acquisition is expected to close in the second quarter of fiscal year 2027, subject to customary regulatory approvals and closing conditions, including antitrust regulatory review.
Nextpower raised its fiscal year 2027 outlook in connection with the transaction, assuming successful closing. The company now expects revenue of approximately $4.0 billion to $4.4 billion, compared to its prior outlook of $3.8 billion to $4.1 billion. Adjusted EBITDA is projected at approximately $845 million to $930 million, compared to the previous outlook of $825 million to $900 million. For context, the company generated $3.56 billion in revenue and $738 million in EBITDA over the last twelve months.Despite the strong growth trajectory, InvestingPro analysis suggests the stock is currently overvalued relative to its Fair Value estimate, placing it among companies on the Most Overvalued list. The company trades at a P/E ratio of 34.38 and an EV/EBITDA multiple of 26.35.
The updated outlook includes approximately $50 million in planned incremental costs related to the acceleration of the company’s entry into the power conversion market. Adjusted EBITDA excludes approximately $208 million for stock-based compensation, net intangible amortization, and acquisition-related costs.
Prevalon’s technology supports applications including AI data centers, private grids, grid-connected storage, and industrial power systems. The company’s products include the Hybrid Power Stabilizer, HD5 DC block, and HD5 AC block, supported by insightOS controls and monitoring capabilities.
Nextpower projects global demand for BESS outside China could represent an opportunity of up to $35 billion by 2030, with the U.S. comprising up to $15 billion.
The acquisition follows Nextpower’s recent announcement of a separate definitive agreement to acquire power conversion technology.Investors should note that 9 analysts have recently revised their earnings estimates downward for the upcoming period, according to InvestingPro Tips. This is one of 20 exclusive ProTips available to subscribers, alongside comprehensive Pro Research Reports that transform complex Wall Street data into clear, actionable intelligence for over 1,400 US equities including NXT.
In other recent news, Nextpower Inc reported impressive financial results for the fourth quarter of fiscal year 2026, surpassing both earnings and revenue expectations. The company posted an adjusted diluted earnings per share of $1.05, exceeding the analyst consensus of $0.93 by 12.9%. Revenue for the quarter reached $881 million, which was 6.17% higher than the forecasted $829.8 million. Mizuho raised its price target for Nextpower shares to $130 from $112, citing strong bookings and strategic acquisitions of Zigor and Apex to expand into power conversion. Meanwhile, BMO Capital increased its price target to $125 from $113, although it noted that the fiscal 2027 guidance presented a mixed picture with unchanged EBITDA but raised revenue expectations. These developments have led to a positive sentiment in the solar sector, with shares of related companies like Enphase Energy, SolarEdge Technologies, and First Solar also seeing gains. The recent earnings report has evidently boosted investor confidence in Nextpower’s performance and strategic direction.
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