Solaris Energy Infrastructure (SEI) AI Stock Analysis

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Solaris Energy Infrastructure

(NYSE:SEI)

61Neutral

Solaris Energy Infrastructure's overall stock score reflects strong revenue growth and future expansion potential, particularly in power solutions. However, financial challenges such as increased debt and negative cash flow, along with bearish technical indicators, present risks. The high P/E ratio suggests overvaluation, although the dividend provides some investor appeal. Positive sentiment from the earnings call supports a moderate outlook despite supply chain and capacity concerns.

Positive Factors

Expansion and Growth

SEI now owns and operates a fleet of mobile NG-fired turbines and is expanding rapidly to meet load growth.

Financial Performance

SEI is poised to double EBITDA in 2025 and grow approximately 30% year-over-year in 2026 as it contracts and deploys 1,400 MW of total capacity.

Negative Factors

Debt and Equity Concerns

The JV will own approximately 500 MW of capacity, leasing it to the data center partner, which lowers SEI's CAPEX load and allows the company to grow faster without raising high coupon debt or equity.

Market Competition

SEI now finds itself at the center of the electrification of everything movement, including increasing power generation demands from generative AI data centers and production-oriented O&G markets.

Solaris Energy Infrastructure (SEI) vs. S&P 500 (SPY)

Market Cap

$1.07B

Dividend Yield3.01%

Average Volume (3M)1.90M

Price to Earnings (P/E)31.6

Beta (1Y)2.02

Revenue Growth6.88%

EPS Growth-35.30%

CountryUS

Employees364

SectorEnergy

Sector Strength61

IndustryOil & Gas Equipment & Services

Share Statistics

EPS (TTM)0.49

Shares Outstanding38,014,100

10 Day Avg. Volume1,425,256

30 Day Avg. Volume1,898,518

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)4.82

Price to Cash Flow (P/CF)28.80

P/FCF Ratio0.00

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$49.00

Price Target Upside189.26% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering4

Solaris Energy Infrastructure Business Overview & Revenue Model

Company DescriptionSolaris Energy Infrastructure, Inc. designs and manufactures specialized equipment for oil and natural gas operators in the United States. The company provides technician support, last mile, and mobilization logistics services. It is also involved in the transloading and storage of proppant or railcars at its transloading facility. In addition, the company develops Railtronix, an inventory management software; and all-electric equipment that automates the low pressure section of oil and gas well completion sites. It serves exploration and production, and oilfield services industries. The company was formerly known as Solaris Oilfield Infrastructure, Inc. and changed its name to Solaris Energy Infrastructure, Inc. in September 2024. Solaris Energy Infrastructure, Inc. was founded in 2014 and is headquartered in Houston, Texas.

How the Company Makes MoneySolaris Energy Infrastructure (SEI) makes money primarily through the sale of solar-generated electricity and the development of solar power projects. The company's key revenue streams include power purchase agreements (PPAs) with utility companies, where SEI sells electricity generated from its solar farms at agreed-upon rates. Additionally, SEI generates income by leasing or selling solar energy systems to residential and commercial clients. The company may also receive incentives, tax credits, and subsidies from government programs aimed at promoting renewable energy adoption. Significant partnerships with technology providers, financial institutions, and construction firms enhance SEI's ability to efficiently deploy and manage solar projects, contributing to its financial success.

Solaris Energy Infrastructure Financial Statement Overview

Summary

Solaris Energy Infrastructure shows solid revenue growth and operational efficiency. However, increased debt levels and negative free cash flow highlight financial challenges that need addressing.

Income Statement

Positive

Solaris Energy Infrastructure has shown consistent revenue growth with a notable increase of 6.88% from 2023 to 2024. The gross profit margin for 2024 is 25.85%, while the net profit margin stands at 5.05%. The EBIT margin has improved to 16.87%, and the EBITDA margin is robust at 30.64%. Despite these positive trends, the net income has decreased compared to the previous year, indicating some challenges in profitability.

Balance Sheet

Positive

The company's debt-to-equity ratio increased significantly to 0.92 in 2024, reflecting higher leverage. Return on Equity (ROE) is healthy at 4.45%. The equity ratio is 31.67%, indicating a moderate reliance on equity for financing. While the company maintains a solid equity base, the increased debt level poses a potential risk.

Cash Flow

Neutral

Solaris Energy Infrastructure experienced a decline in free cash flow, from $23.87 million in 2023 to negative $129.05 million in 2024, reflecting significant capital expenditures. The operating cash flow to net income ratio is 3.75, indicating strong cash generation relative to net income. However, the free cash flow to net income ratio is negative due to high capital spending.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
313.09M	292.95M	320.00M	159.19M	102.98M
	Gross Profit
80.95M	78.92M	69.80M	16.52M	10.19M
	EBIT
52.82M	49.90M	41.80M	-387.00K	-59.90M
	EBITDA
95.95M	86.09M	72.24M	26.82M	-32.88M
	Net Income Common Stockholders
15.81M	24.34M	21.16M	-868.00K	-29.34M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
114.25M	5.83M	8.84M	36.50M	60.37M
	Total Assets
1.12B	468.30M	462.58M	406.22M	411.90M
	Total Debt
328.88M	47.79M	20.48M	7.52M	8.20M
	Net Debt
214.62M	41.96M	11.65M	-28.98M	-52.17M
	Total Liabilities
456.15M	152.72M	145.45M	108.35M	96.42M
	Stockholders Equity
355.62M	205.98M	215.72M	203.15M	201.25M
Cash Flow		Free Cash Flow
-129.05M	23.87M	-13.41M	-3.17M	39.19M
	Operating Cash Flow
59.37M	88.26M	68.00M	16.47M	43.85M
	Investing Cash Flow
-305.03M	-62.00M	-79.54M	-19.52M	-3.77M
	Financing Cash Flow
399.70M	-29.26M	-16.12M	-20.82M	-46.59M

Solaris Energy Infrastructure Technical Analysis

Technical Analysis Sentiment

Negative

Last Price16.94

Price Trends

50DMA

25.79

Negative

100DMA

26.17

Negative

200DMA

19.11

Negative

Market Momentum

MACD

-1.50

Positive

RSI

39.82

Neutral

STOCH

34.70

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SEI, the sentiment is Negative. The current price of 16.94 is below the 20-day moving average (MA) of 22.10, below the 50-day MA of 25.79, and below the 200-day MA of 19.11, indicating a bearish trend. The MACD of -1.50 indicates Positive momentum. The RSI at 39.82 is Neutral, neither overbought nor oversold. The STOCH value of 34.70 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SEI.

Solaris Energy Infrastructure Peers Comparison

Overall Rating

UnderperformOutperform

Sector (57)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FSLR	75 Outperform	$13.78B	10.71	17.62%	―	26.75%	55.24%
NEE	72 Outperform	$137.74B	19.84	14.24%	3.15%	26.91%	-6.43%
ENPH	68 Neutral	$7.59B	77.58	11.30%	―	-41.92%	-76.24%
SEI	61 Neutral	$1.07B	31.59	5.16%	3.01%	6.88%	-35.30%
Sector *	57 Neutral	$7.71B	4.16	-3.52%	8.32%	0.35%	-64.68%
SEDG	51 Neutral	$864.69M	―	-116.01%	―	-68.86%	-4917.87%
RUN	46 Neutral	$1.58B	―	-73.12%	―	-9.83%	-71.44%

* Energy Sector Average

Performance Comparison

SEI

Solaris Energy Infrastructure

16.94

8.28

95.61%

ENPH

Enphase Energy

55.76

-59.48

-51.61%

FSLR

First Solar

130.05

-49.17

-27.44%

NEE

NextEra Energy

65.06

1.98

3.14%

SEDG

SolarEdge Technologies

13.35

-53.60

-80.06%

RUN

Sunrun

6.57

-5.31

-44.70%

Solaris Energy Infrastructure Earnings Call Summary

Earnings Call Date: Feb 21, 2025 | % Change Since: -41.95% | Next Earnings Date: Apr 28, 2025

Earnings Call Sentiment Positive

The earnings call reflects a positive outlook for Solaris Energy Infrastructure, driven by substantial growth in their power solutions segment and strong financial performance. However, concerns about supply chain costs and uncontracted capacity pose potential risks. The company's continued dividend payments and strategic partnerships highlight robust shareholder value creation.

Highlights

Significant Growth in Power Solutions

Solaris Energy Infrastructure announced a new order for an additional 700 megawatts, doubling their fleet size to approximately 1,400 megawatts (1.4 gigawatts) by early 2027. This growth is supported by a strategic long-term partnership with a customer for a minimum of 500 megawatts with an initial term of six years for a new data center.

Strong Financial Performance

Solaris reported a 28% increase in total revenue and a 68% increase in adjusted EBITDA from the prior quarter. The Solaris Power Solutions segment contributed over 50% of the adjusted EBITDA mix, expected to rise to nearly 80% once the fleet is fully deployed.

Continued Dividend Payments

The board approved Solaris' 26th consecutive dividend of $0.12 per share for both A and B class shareholders, highlighting the company's commitment to returning cash to shareholders.

Increased Activity in Solaris Logistics

An expected 15% sequential increase in fully utilized systems in Q1, alongside market share gains, reflects the positive impact of new technology adoption and excellent service.

Lowlights

Supply Chain Concerns

There are concerns about creeping supply chain costs, including potential tariff impacts, which could affect the cost structure of future expansions.

Uncontracted Capacity

Approximately 450 megawatts of the fleet are uncontracted, posing risks if these capacities are not contracted in the expected timeline.

Market Uncertainties

The presence of significant market noise and hype, particularly in ERCOT, requiring careful navigation to avoid overcommitment or misalignments with actual demand.

Company Guidance

During the fourth quarter 2024 earnings call, Solaris Energy Infrastructure Inc. provided detailed guidance on their future growth trajectory, particularly focusing on their mobile power generation business, Solaris Power Solutions. The company announced a significant expansion of their power fleet, with plans to increase their generation capacity from the current 150 megawatts to approximately 1,400 megawatts by early 2027, effectively doubling their fleet size with a new order of 700 megawatts. Additionally, Solaris unveiled a strategic long-term partnership with a current customer, securing a six-year contract for approximately 500 megawatts to support a new data center. This partnership includes a joint venture arrangement where Solaris will own 50.1% of the assets. The company's financial expectations are promising, with projected adjusted EBITDA of $400 million to $425 million once the fleet is fully deployed. This expansion is part of Solaris' strategy to capitalize on the growing demand for behind-the-meter power solutions, driven by increasing electrification, reshoring of manufacturing, and data center growth.

Solaris Energy Infrastructure Corporate Events

M&A TransactionsFinancial Disclosures

Solaris Energy Infrastructure Completes Major Acquisition

Neutral

Apr 3, 2025

On September 11, 2024, Solaris Energy Infrastructure completed the acquisition of Mobile Energy Rental LLC, a move that reflects in their financial statements for the year ended December 31, 2024. The acquisition, valued at $60 million in cash and additional equity considerations, is expected to impact Solaris’s financial operations significantly, with adjustments made for refinancing existing debt and funding the transaction. The pro forma financial statements illustrate the anticipated effects of the acquisition, although these are preliminary and subject to change.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.