Critical Review: Nextpower (NASDAQ:NXT) & Hubbell (NYSE:HUBB)

Nextpower (NASDAQ:NXT) and Hubbell (NYSE:HUBB) are both large-cap industrials companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, valuation, analyst recommendations, risk, institutional ownership and dividends.

Analyst Ratings

This is a summary of recent ratings and price targets for Nextpower and Hubbell, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nextpower	0	4	23	1	2.89
Hubbell	0	5	5	1	2.64

Nextpower currently has a consensus target price of $142.77, indicating a potential upside of 65.80%. Hubbell has a consensus target price of $556.78, indicating a potential upside of 17.53%. Given Nextpower’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Nextpower is more favorable than Hubbell.

Valuation & Earnings

This table compares Nextpower and Hubbell”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nextpower	$3.56 billion	3.67	$585.88 million	$3.86	22.31
Hubbell	$5.84 billion	4.28	$887.10 million	$16.89	28.05

Hubbell has higher revenue and earnings than Nextpower. Nextpower is trading at a lower price-to-earnings ratio than Hubbell, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Nextpower and Hubbell’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nextpower	16.36%	26.29%	15.02%
Hubbell	14.49%	27.11%	11.48%

Volatility & Risk

Nextpower has a beta of 1.94, meaning that its share price is 94% more volatile than the S&P 500. Comparatively, Hubbell has a beta of 0.85, meaning that its share price is 15% less volatile than the S&P 500.

Insider and Institutional Ownership

67.4% of Nextpower shares are owned by institutional investors. Comparatively, 88.2% of Hubbell shares are owned by institutional investors. 0.8% of Nextpower shares are owned by company insiders. Comparatively, 0.6% of Hubbell shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

About Nextpower

Nextpower, formerly known as Nextracker, an energy solutions company, provides solar trackers and software solutions for utility-scale and distributed generation solar projects in the United States and internationally. The company offers tracking solutions, which includes NX Horizon, a solar tracking solution; and NX Horizon-XTR, a terrain-following tracker designed to expand the addressable market for trackers on sites with sloped, uneven, and challenging terrain. It also provides TrueCapture, a self-adjusting tracker control system, which boosts solar power plant production by optimizing the position of individual tracker row in response to site features, such as varying topography and changing weather conditions; and NX Navigator, that assists solar power plant owners and operators in monitoring, controlling, and protecting their solar projects. The company was founded in 2013 and is headquartered in Fremont, California. As of March 31, 2024 Nextracker Inc. (Nextpower) was formerly a subsidiary of Flex Ltd.

About Hubbell

Hubbell Incorporated, together with its subsidiaries, designs, manufactures, and sells electrical and utility solutions in the United States and internationally. It operates through two segments, Electrical Solutions and Utility Solutions. The Electrical Solution segment offers standard and special application wiring device products, rough-in electrical products, connector and grounding products, lighting fixtures, and other electrical equipment for use in industrial, commercial, and institutional facilities by electrical contractors, maintenance personnel, electricians, utilities, and telecommunications companies, as well as components and assemblies. It also designs and manufactures various industrial controls, and communication systems for use in the non-residential and industrial markets, as well as in the oil and gas, and mining industries. This segment sells its products through electrical and industrial distributors, home centers, retail and hardware outlets, lighting showrooms, and residential product-oriented internet sites; and special application products primarily through wholesale distributors to contractors, industrial customers, and original equipment manufacturers. The Utility Solution segment designs, manufactures, and sells electrical distribution, transmission, substation, and telecommunications products, such as arresters, insulators, connectors, anchors, bushings, and enclosures cutoffs and switches; and utility infrastructure products, including smart meters, communications systems, and protection and control devices. This segment sells its products to distributors. Its brand portfolio includes Hubbell, Kellems, Bryant, Burndy, CMC, Bell, TayMac, Wiegmann, Killark, Hawke, Aclara, Fargo, Quazite, Hot Box, etc. The company was founded in 1888 and is headquartered in Shelton, Connecticut.