Value
4.3/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 0.5 |
| P/S | 3.3 |
| EV/EBITDA | 0.0 |
| Fwd P/E | 4.0 |
| PEG | 10.0 |
| Analyst target | 5.0 |
- ▸Forward P/E: 29.9x
- ▸PEG: 0.24
SEI · Why this verdict
Why Solaris Energy Infrastructure, (SEI) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.6/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Solaris Energy Infrastructure delivered 55% revenue growth and beat earnings in all 4 recent quarters with an average positive surprise of 57%, is in a golden cross technical breakout, and leads its peer group in growth, but the stock has reached the analyst target with only 2.5% remaining upside, a 24% short interest, and negative free cash flow at -1363% of revenue.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Free cash flow is -1363% of net income — a severe quality red flag — indicating the company is consuming significant cash in its rapid growth phase, with capital expenditures dramatically exceeding operating cash generation despite the strong revenue growth. Quality breakdown | Free cash flow as a percentage of net income improves to less than -300%, improving by more than 1000 percentage points from the current level within 24 months. | →Stable |
| CounterFor infrastructure companies growing revenue at 55% annually, negative free cash flow reflects the capital investment required to build capacity ahead of revenue; this is often a sign of aggressive and productive reinvestment rather than financial weakness. | ||
Revenue grew 55% year over year — the highest growth rate in the current analysis — and the company beat earnings estimates in all 4 consecutive quarters with an average positive surprise of 56.7%, including an 87% beat in July 2025 and a 68% beat in April 2026. Earnings | Revenue growth remains above 30% year over year and earnings beats continue in at least 3 of the next 4 quarters. | →Stable |
| CounterEarnings beats of 50-80% against consensus estimates typically reflect analysts who dramatically underestimated the business; as analyst models are updated, the bar will rise and maintaining such large beats will become structurally impossible. | ||
The stock is in a confirmed golden cross breakout — above all major moving averages with RSI at 53, bullish MACD, and rising on-balance volume — positioning it near its 52-week high with strong institutional accumulation signals. V9 | Price holds above all major moving averages and RSI stays above 50 for at least 90 consecutive trading days. | →Stable |
| CounterThe stock is already near the Bollinger upper band with the technical score at a maximum, suggesting it is extended and may need to consolidate before making additional upside progress. | ||
With only 2.5% upside to the analyst target of $80.03 from the current $78.07, and the analyst target already effectively reached, there is insufficient technical room for new entries at current prices even though the fundamental growth story remains intact. Warnings | Analyst consensus target rises above $95, more than 21% above the current $78.07, as analysts update models to reflect the sustained beat streak. | →Stable |
| CounterIn fast-growing companies with consistent earnings beats, analyst targets are typically revised upward after each quarterly report; the current thin upside reflects stale targets rather than a ceiling on the stock's potential. | ||
Free cash flow is -1363% of net income — a severe quality red flag — indicating the company is consuming significant cash in its rapid growth phase, with capital expenditures dramatically exceeding operating cash generation despite the strong revenue growth.
→StableQuality breakdown
- Expectation
- Free cash flow as a percentage of net income improves to less than -300%, improving by more than 1000 percentage points from the current level within 24 months.
CounterFor infrastructure companies growing revenue at 55% annually, negative free cash flow reflects the capital investment required to build capacity ahead of revenue; this is often a sign of aggressive and productive reinvestment rather than financial weakness.
Revenue grew 55% year over year — the highest growth rate in the current analysis — and the company beat earnings estimates in all 4 consecutive quarters with an average positive surprise of 56.7%, including an 87% beat in July 2025 and a 68% beat in April 2026.
→StableEarnings
- Expectation
- Revenue growth remains above 30% year over year and earnings beats continue in at least 3 of the next 4 quarters.
CounterEarnings beats of 50-80% against consensus estimates typically reflect analysts who dramatically underestimated the business; as analyst models are updated, the bar will rise and maintaining such large beats will become structurally impossible.
The stock is in a confirmed golden cross breakout — above all major moving averages with RSI at 53, bullish MACD, and rising on-balance volume — positioning it near its 52-week high with strong institutional accumulation signals.
→StableV9
- Expectation
- Price holds above all major moving averages and RSI stays above 50 for at least 90 consecutive trading days.
CounterThe stock is already near the Bollinger upper band with the technical score at a maximum, suggesting it is extended and may need to consolidate before making additional upside progress.
With only 2.5% upside to the analyst target of $80.03 from the current $78.07, and the analyst target already effectively reached, there is insufficient technical room for new entries at current prices even though the fundamental growth story remains intact.
→StableWarnings
- Expectation
- Analyst consensus target rises above $95, more than 21% above the current $78.07, as analysts update models to reflect the sustained beat streak.
CounterIn fast-growing companies with consistent earnings beats, analyst targets are typically revised upward after each quarterly report; the current thin upside reflects stale targets rather than a ceiling on the stock's potential.
Per-dimension breakdown
Quality
4.7/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 2.9 |
| ROA | 3.3 |
| Gross margin | 5.4 |
| Op margin | 10.0 |
| Net margin | 3.3 |
| Current ratio | 4.3 |
| FCF quality | 0.0 |
| Moat | 5.6 |
| Piotroski F | 7.8 |
- ▸Earnings quality RED FLAG: -1363% FCF/NI
- ▸Strong Piotroski F-Score: 7/9
Growth
10.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 10.0 |
| EPS growth | 10.0 |
- ▸Strong growth: 55% YoY
Momentum
5.1/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 10.0 |
| OBV | 1.0 |
| MA position | 9.0 |
| Volume | 0.0 |
- ▸Volume distribution (falling OBV)
- ▸Above 200-day MA
Sentiment
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 8.4 |
| Price target | 7.6 |
| erm sentiment | 5.0 |
Insider
3.4/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 2.0 |
| insider conviction | 3.2 |
| holder change | 5.1 |
- ▸Heavy insider selling — $297,331,627 (4.189% of mkt cap)
Peer rank
3.7/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 0.6 |
| quality rank | 5.0 |
| growth rank | 9.3 |
- ▸Industry growth leader
Technical
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 3.4 |
| support resistance | 4.2 |
| 52w position | 8.0 |
| gap | 5.0 |
Risk (lower is worse)
3.2/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 0.0 |
| days to cover | 5.1 |
| volatility | 0.0 |
| put call | 6.9 |
| implied vol | 0.0 |
| beta | 6.2 |
| debt equity | 4.1 |
- ▸High short interest: 24%
- ▸High IV: 84%
Catalyst
7.0/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 4.8 |
- ▸Perfect beat streak: 4Q
- ▸Yield trap warning: high yield but unsafe
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (7)
- MOMENTUM:5.1>=4.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:28d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:0.2<1.5@spot
Warning (1)
- MOMENTUM:5.1<5.5 (soft — BUY_NOW allowed but watch)
Reward-to-Risk
0.22
Upside
+3.3%
Downside
15.0%
Sizing output
AVOID
SetupBREAKOUT — Golden cross, above all MAs, RSI 51, MACD bullish
EdgeCATALYST — Earnings in 28d with 4/4 beat streak
SuitabilityMODERATE — Balanced profile
Investment implication
The F-path SELL output reflects an overall score of 5.1 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Growth at 10.0) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:0.2<1.5@spot) reinforce the read. Current asymmetry R:R is 0.22 — supplementary context, not the trigger for this path.
The strongest dimensions are Growth at 10.0, Sentiment at 7.2, and Catalyst at 7.0; the weakest are Risk (lower is worse) at 3.2, Insider at 3.4, and Peer rank at 3.7. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of 0.22 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Revenue grew 55% year over year — the highest growth rate in the current analysis — and the company beat earnings estimates in all 4 consecutive quarters with an average positive surprise of 56.7%, including an 87% beat in July 2025 and a 68% beat in April 2026.
Trip ifRevenue growth falls below 20% year over year, declining more than 35 percentage points from the current 55% rate.
- P2The stock is in a confirmed golden cross breakout — above all major moving averages with RSI at 53, bullish MACD, and rising on-balance volume — positioning it near its 52-week high with strong institutional accumulation signals.
Trip ifPrice falls below $70, more than 10% below the current $78.07, breaking the golden cross pattern and invalidating the breakout.
- P3With only 2.5% upside to the analyst target of $80.03 from the current $78.07, and the analyst target already effectively reached, there is insufficient technical room for new entries at current prices even though the fundamental growth story remains intact.
Trip ifAnalyst consensus price target remains below $85 for more than 2 consecutive quarters after earnings reports, indicating analysts are not revising upward.
- P4Free cash flow is -1363% of net income — a severe quality red flag — indicating the company is consuming significant cash in its rapid growth phase, with capital expenditures dramatically exceeding operating cash generation despite the strong revenue growth.
Trip ifFree cash flow as a percentage of net income falls below -2000%, further deteriorating by more than 637 percentage points from the current already-negative level.