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Investing.com - Jefferies has lowered its price target on Array Technologies (NASDAQ:ARRY) to $10.00 from $13.00 while maintaining a Buy rating on the stock. Currently trading at $7.92, the solar tracking systems manufacturer, with a market capitalization of $1.2 billion, appears undervalued according to InvestingPro analysis, which also reveals that 14 analysts have recently revised their earnings estimates upward.
The firm expects Array Technologies to update its fiscal year 2025 guidance following the APA acquisition, which will include partial third-quarter and full fourth-quarter contributions from the acquired company.
Jefferies notes that while the APA acquisition is margin-accretive, potential dis-synergies may compress margins in the near term, with the firm estimating fiscal year 2025 revenue of $1.25 billion and gross margin of approximately 28.7%.
According to Jefferies, Array Technologies management remains confident in margin preservation despite tariff headwinds, and the company is expected to generate over $100 million per year in free cash flow in the long term, potentially enabling future acquisitions.
The firm emphasizes that successful integration of APA will be crucial to bolster investor confidence in Array Technologies going forward.
In other recent news, Array Technologies reported impressive second-quarter earnings for 2025, exceeding market expectations with an earnings per share (EPS) of $0.25, compared to the forecasted $0.19. The company’s revenue reached $362 million, surpassing the anticipated $291.41 million. This strong performance highlights a significant 24.29% increase in revenue. Additionally, Array Technologies has completed its acquisition of APA Solar, which will operate as a strategic business unit, expanding Array’s product portfolio. In another development, Array’s DuraTrack and OmniTrack systems have been verified for compatibility with 2000-volt module-wired systems by Intertek. Analyst firms have responded positively to these developments, with Jefferies raising its price target for Array Technologies to $13 from $10, citing the completion of the APA transaction as a key factor. UBS also increased its price target to $9 from $8.50, reflecting improved gross margins in the company’s financial guidance for 2025. These recent developments suggest a positive outlook for Array Technologies in the solar tracking industry.
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