TLDR
- Solaris Energy Infrastructure (SEI) shares gained 4.2% Tuesday following announcement of a third data center power agreement
- The agreement provides 600+ megawatts of power capacity to a global technology company over a 10-year period
- First quarter earnings per share reached 32 cents, falling one cent short of the 33-cent consensus estimate
- First quarter revenue hit $196.2 million, surpassing the $183.4 million forecast and marking a 55% annual increase
- Morgan Stanley reaffirmed its Overweight stance with an $81 target price for SEI shares
Shares of Solaris Energy Infrastructure rallied Tuesday as the company unveiled a third long-term power supply agreement with a prominent tech industry player, overshadowing a marginal quarterly earnings shortfall.
Solaris Energy Infrastructure, Inc., SEI
The shares peaked at $81.24 during intraday trading before settling with a 4.2% gain at $73.66. Year-to-date, SEI has surged 54% in 2026, with April alone accounting for 25% of those gains.
Inked on April 24, the latest agreement calls for Solaris to supply over 600 megawatts of generating capacity to an entity affiliated with an “investment-grade, global technology company.” The initial contract spans a decade, featuring an optional five-year extension.
Solaris anticipates commencing power deployments in late 2026, with a planned expansion continuing through 2028.
Regarding quarterly performance, first quarter earnings registered at 32 cents per share—double the 14 cents reported in the prior-year period, though trailing analyst projections by a penny. Revenue painted a brighter picture, climbing 55% annually to $196.2 million and exceeding the Street’s $183.4 million expectation.
Pivoting from Traditional Energy to Tech Infrastructure
Solaris’s entrance into the data center power sector began in 2024 with its $323 million acquisition of Mobile Energy Rentals. This strategic purchase equipped the company with mobile gas turbine technology and distributed power generation capabilities.
Currently, Solaris delivers primary power generation, equipment sourcing, and engineering solutions directly to data center facilities—operating independently of traditional utility grids. During Tuesday’s earnings discussion, Co-CEO Bill Zartler highlighted that lengthy grid connection timelines are driving customers toward behind-the-meter power alternatives, creating opportunities for Solaris.
“The broader power market continues to reinforce and support our strategy,” Zartler said.
He further mentioned that the company maintains ongoing negotiations with both current clients and prospective customers regarding additional projects.
Wall Street Analyst Endorses Recent Contract
Morgan Stanley analyst David Arcaro indicated the newest contract “strengthens” the firm’s Overweight recommendation and $81 price objective for SEI.
Arcaro projects the 600-megawatt agreement—assuming $300 per kilowatt pricing—could generate approximately $450 million in value, translating to roughly $5 per share. He anticipates Solaris’s valuation multiple will expand as long-term contractual visibility increases.
Nevertheless, Arcaro cautioned that profit margins on extended contracts might prove lower, and that conservative third quarter guidance could signal uncertainty regarding new contract implementation timelines.
Concerning forward guidance, Solaris elevated its second quarter adjusted EBITDA projection to a range of $83–$93 million, up from the previous $76–$84 million band. The company established third quarter adjusted EBITDA guidance at $80–$95 million—placing the midpoint beneath Wall Street’s $100.5 million consensus.
Executives attributed the tempered third quarter outlook to evolving circumstances in a joint venture initiative and new equipment arrivals scheduled for the latter half of 2026.
Solaris’s present price-to-earnings ratio stands at 99.48x, indicating substantial growth expectations. The company receives a GF Score of 77/100, featuring a growth ranking of 9/10 alongside a financial strength assessment of merely 5/10.
Insider trading patterns over the trailing twelve months reveal 11 sales versus 7 purchases—a divergent signal warranting investor attention.
