NVTS: Data Center Ambitions Will Meet High Multiples And Easing Gallium Pressures

Analysts have modestly raised their price target on Navitas Semiconductor to $12 from $8, citing optimism around the long term opportunity in 800VDC data center architectures. At the same time, they caution that current valuations already embed high expectations and that investors may lack patience for a roughly two year inflection timeline.

Analyst Commentary

Analyst commentary on Navitas reflects a mixed but generally constructive stance, with optimism around long term growth tempered by concerns about valuation and execution risk.

Bullish Takeaways

• Bullish analysts view the move to a $12 price target as recognition of a sizeable long term opportunity in 800VDC data center architectures.
• The upgraded target price implies confidence that Navitas can translate its technology leadership into accelerating revenue growth as new architectures are adopted.
• Optimists argue that early positioning in next generation data center power solutions could support premium growth rates beyond the current consensus window.

Bearish Takeaways

• Bearish analysts highlight that the stock is already trading at around 60 times consensus FY26 revenue, suggesting a rich valuation relative to current fundamentals.
• There is concern that investor patience may wane if the anticipated 800VDC data center inflection takes roughly two years to materialize, creating near term execution pressure.
• Cautious views emphasize that expectations for the impact of 800VDC architectures appear ahead of the broader market adoption curve, increasing the risk of disappointment.
• Some see the combination of extended timelines and elevated multiples as limiting upside in the absence of faster than expected design wins or revenue conversion.

What's in the News

• China suspends export controls for one year on several critical minerals, including gallium, potentially easing raw material supply concerns for gallium producers such as Navitas Semiconductor and peers in the GaN value chain (New York Times).
• Navitas Semiconductor and WT Microelectronics deepen their strategic partnership in Asia, consolidating Navitas' distributor base with WT and expanding technical and commercial resources to support AI data centers, energy infrastructure and industrial electrification customers.
• GlobalFoundries and Navitas announce a long term strategic partnership to develop and manufacture next generation GaN technology at GF's Burlington, Vermont facility, creating a U.S. based pathway for advanced GaN solutions serving AI data centers, grid and industrial markets.
• Navitas completes a roughly $100 million private placement of Class A common shares, providing additional capital after paying $4 million in sales commissions, with the issuance priced at $6.75 per share under a Regulation D securities purchase agreement.
• Navitas issues fourth quarter 2025 revenue guidance of approximately $7 million, plus or minus $0.25 million, as it deprioritizes lower margin China mobile and consumer business to pivot toward higher power, higher value customers.

Valuation Changes

• Fair Value Estimate: Unchanged at $8.28 per share. This indicates no material adjustment to the intrinsic value assessment despite the higher price target.
• Discount Rate: Fallen slightly from approximately 10.51 percent to 10.42 percent, reflecting a modest reduction in perceived risk or required return.
• Revenue Growth: Effectively unchanged at around 26.29 percent, suggesting stable expectations for long term top line expansion.
• Net Profit Margin: Essentially flat at roughly 14.17 percent, indicating no significant revision to long term profitability assumptions.
• Future P/E: Edged down marginally from about 181.9x to 181.4x, implying a very small moderation in the forward earnings multiple embedded in the valuation.