NVTS: 800VDC Data Center Promise Will Face Elevated Multiples And Easing Gallium Risks

Analysts have raised their price target on Navitas Semiconductor from $8 to $12 per share, reflecting increased conviction in the long term potential of 800VDC data center architectures, even as they caution that current valuations may overestimate how quickly this market will inflect.

Analyst Commentary

Bullish Takeaways

• Bullish analysts highlight that raising the price target to $12 signals increased confidence in Navitas capturing a meaningful share of emerging 800VDC data center demand.
• The higher target reflects a belief that Navitas can execute on its roadmap and translate early design wins into accelerating revenue growth over the next several years.
• Supporters argue that premium valuation multiples are justified by the company’s positioning in a structurally growing market segment, with potential upside if adoption timelines are accelerated.
• Optimistic views also point to the company’s technology differentiation as a key driver of long term margin expansion and operating leverage as volumes scale.

Bearish Takeaways

• Bearish analysts caution that, at roughly 60 times consensus FY26 revenue, the current valuation already reflects expectations of a rapid and smooth ramp of 800VDC architectures that may prove optimistic.
• There is concern that investor patience could wear thin if revenue inflection in the data center market takes longer than the roughly two year window currently embedded in expectations.
• Skeptics warn that any execution missteps, delays in customer qualifications, or slower than expected adoption could trigger multiple compression from today’s elevated levels.
• More cautious views emphasize that, despite strong long term potential, the risk reward looks less compelling in the near term given the gap between current fundamentals and the growth implied by the share price.

What's in the News

• China suspended for one year its export controls on several critical minerals, including gallium and germanium. This eases near-term supply risk for raw materials used in GaN production that involve Navitas as a gallium producer peer group member (The New York Times).
• Navitas expanded its global distribution agreement with Avnet and consolidated franchised partners to broaden access to its GaN and SiC power devices for AI data centers, high performance computing, renewable energy, and industrial electrification customers.
• The company announced sample availability of new 2300V and 3300V ultra high voltage SiC products and introduced an AEC Plus reliability benchmark that exceeds standard automotive and JEDEC qualification requirements for grid and energy infrastructure applications.
• Navitas and GlobalFoundries entered a long term strategic manufacturing partnership to develop and scale U.S.-based GaN technology at GF’s Burlington, Vermont facility, targeting high power markets including AI data centers and grid infrastructure.
• Navitas reported progress on 800 VDC GaN and SiC power devices designed to support NVIDIA’s next generation 800 VDC AI factory architecture, positioning the company directly in the emerging high voltage data center power transition.

Valuation Changes

• Fair Value Estimate: Unchanged at $8.28 per share. This indicates no material revision to the intrinsic value assessment.
• Discount Rate: Risen slightly from 10.42 percent to 10.46 percent. This reflects a modest increase in perceived risk or required return.
• Revenue Growth: Effectively unchanged at approximately 26.29 percent long term. This signals stable expectations for top line expansion.
• Net Profit Margin: Risen slightly from about 14.17 percent to 14.71 percent. This implies a modestly more optimistic view on future profitability.
• Future P/E: Fallen slightly from roughly 181.4 times to 174.9 times. This suggests a small reduction in the multiple applied to forward earnings.