Array Technologies stock unchanged as Mizuho reiterates neutral rating
Investing.com
Published Jun 27, 2025 07:29AM ET
Investing.com - Mizuho maintained its Neutral rating and $9.00 price target on Array Technologies (NASDAQ:ARRY) on Friday, following the solar tracking company's recent convertible note offering. The stock, currently trading at $6.50 with a market capitalization of approximately $992 million, appears undervalued according to InvestingPro analysis.
Array Technologies issued $300 million in convertible notes on Wednesday, with the offering expanding to $345 million with the overallotment option. The notes carry a 2.875% coupon rate, while Mizuho estimates a net yield of approximately 3.3% after accounting for debt discount and capped call costs.
The solar tracker manufacturer plans to use the proceeds to refinance its 2027 term loan, which carries an interest rate of SOFR plus 3.25%, as well as its 1% convertible notes due in 2028. The company indicated the remaining funds would be allocated for general corporate purposes.
Mizuho estimates the refinancing will decrease Array's net interest expense by approximately $5 million per year. The firm adjusted its financial model to account for the new convertible notes offering.
The $345 million convertible note offering closed on Friday, according to Mizuho's research note, which maintained its existing price target on Array Technologies stock.
In other recent news, Array Technologies announced plans to offer $250 million in convertible senior notes due 2031 through a private placement. The proceeds from this offering are intended to repay $150 million of its outstanding term loan facility and fund capped call transactions to reduce potential stock dilution. Additionally, Array Technologies recently announced the acquisition of APA Solar for $179 million, which is expected to enhance its adjusted earnings per share in the first year. The acquisition will expand Array's market by nearly 40% and bolster its U.S. manufacturing capabilities with APA's Ohio facility. Goldman Sachs maintained its buy rating and $11.00 price target on Array Technologies, viewing the company's recent debt offering as a strategic move to reduce costs and increase working capital. Meanwhile, Mizuho raised its price target on Array Technologies to $9.00 from $8.00, noting the strategic significance of the APA Solar acquisition. Oppenheimer reiterated an Outperform rating with a $13.00 price target, highlighting the expanded geographic footprint and product offerings brought by APA. These developments reflect Array's ongoing efforts to strengthen its financial structure and expand its market presence.
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