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FLEX Completes Spin-off of Outstanding Interest in Nextracker

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Flex Inc (FLEX - Free Report) announced that it had completed the spin-off of all its remaining interest in Nextracker to its shareholders (on a pro-rata basis). The shares of Nextracker will continue to trade on the Nasdaq under the ticker symbol "NXT."

Initially, Nextracker had filed a registration statement with the U.S. Securities and Exchange Commission for a proposed initial public offering of shares of Nextracker's common stock in January 2023.

Following that, in February 2023, Nextracker announced its initial public offering of 23,255,814 shares of its common stock. Furthermore, Flex announced that the underwriters have fully exercised their option to buy 3,990,000 additional shares of Common Stock at the public offering price of $24 per share, less underwriting discounts and commissions, in connection with Nextracker's enlarged initial public offering of 26,600,000 shares of its common stock.

Flex Ltd. Price and Consensus

Flex Ltd. Price and Consensus

Flex Ltd. price-consensus-chart | Flex Ltd. Quote

In June 2023, the company announced the underwriters had fully exercised their option to buy 1,650,000 additional shares of Nextracker at $36.50 per share, less underwriting discounts and commissions. In October, the company then announced its plan to spin-off approximately 51.47% of its interest in Nextracker to Flex shareholders (on a pro-rata basis).

Overall, for each Flex ordinary share held as of the record date of Dec 29, 2023, Flex shareholders received roughly 0.17 shares of Nextracker common stock. Hence, 74,432,619 shares of Nextracker common stock were issued to Flex shareholders. Any fractional shares will be replaced with cash for Flex shareholders.

In September 2015, Flex acquired Nextracker for $330 million to expand its solar capabilities in commercializing smart and connected energy technologies. Nextracker is a leading provider of solar tracker and software solutions for utility-scale and ground-mounted solar projects worldwide. In the second quarter, Nextracker group’s revenues rose 21% year over year to $0.6 billion.

For third-quarter fiscal 2024, total Flex (including Nextracker) revenues are expected to be between $6.5 billion and $6.9 billion. Management expects adjusted earnings per share (EPS) in the range of 57-65 cents.

At present, FLEX has a Zacks Rank #3 (Hold). Shares of the company have gained 40.4% in the past year compared with the sub-industry’s growth of 26.3%.

Zacks Investment Research
Image Source: Zacks Investment Research

Stocks to Consider

Some better-ranked stocks worth considering in the broader technology space are Blackbaud (BLKB - Free Report) , NETGEAR (NTGR - Free Report) and Watts Water Technologies (WTS - Free Report) . NETGEAR sports a Zacks Rank #1 (Strong Buy), while Blackbaud and Watts Water Technologies carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Blackbaud’s 2023 EPS has inched up 1.8% in the past 60 days to $3.86. BLKB’s long-term earnings growth rate is 23.4%.

Blackbaud’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 10.6%. Shares of BLKB have gained 52% in the past year.

The Zacks Consensus Estimate for 2023 is pegged at a loss of 9 cents per share for NETGEAR, which remained unchanged in the past 30 days. NTGR’s earnings outpaced the Zacks Consensus Estimate in three of the last four quarters while missing once. The average surprise was 127.5%. Shares of NTGR lost 14% in the past year.

The Zacks Consensus Estimate for Watts Water Technologies 2023 EPS has improved 3.9% in the past 60 days to $8.08.

WTS’ earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 11.8%. Shares of WTS have soared 43.7% in the past year.

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