Should You Buy Navitas Semiconductor Stock Now?
Key Points
Data centers are focusing on energy efficiency to control costs.
This could drive growing demand for Navitas power control products.
The stock reflects this potential, trading at 28 times revenue.
- 10 stocks we like better than Navitas Semiconductor ›
Leading tech companies are investing heavily in data centers for artificial intelligence (AI). This is opening up opportunities for Navitas Semiconductor (NASDAQ: NVTS).
Navitas uses specialized materials, such as gallium nitride (GaN), to make semiconductors that convert and control power in consumer devices like smartphones. But it's now pivoting to the data center market. Data centers will need greater energy efficiency to keep costs down and run next-generation chips.
Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »
The stock has nearly tripled in value over the past year, as management expects the business to begin benefiting from this opportunity over the next few years.
Image source: Getty Images.
Navitas is transitioning from selling products in low-margin consumer markets to a more profitable opportunity in AI data centers. The company estimates the total serviceable addressable market will grow from 66% to 87% annually through 2030, reaching $1.4 billion to $2.5 billion. That's significant compared to Navitas' trailing-12-month revenue of $56 million.
However, Wall Street analysts are mixed on the stock's upside, with most calling it a hold. This seems to be a valuation-based call, as the stock is already trading at an expensive 28 times sales. This valuation accounts for a significant increase in the company's revenue.
The stock's upside might be limited until Navitas shows stronger growth from this opportunity. Revenue has been falling as Navitas transitions its business from the consumer market to data centers. It also reported a $19 million loss in the third quarter.
Analysts expect the company's revenue to decline in 2026, suggesting Navitas may not deliver meaningful results from the data center opportunity until 2027. That's a long time to wait for a stock trading at a high sales multiple. Given the high valuation, investors might want to wait until the business returns to revenue growth before buying shares.
Should you buy stock in Navitas Semiconductor right now?
Before you buy stock in Navitas Semiconductor, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Navitas Semiconductor wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $409,970!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,174,241!*
Now, it’s worth noting Stock Advisor’s total average return is 889% — a market-crushing outperformance compared to 192% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
See the 10 stocks »
*Stock Advisor returns as of February 24, 2026.
John Ballard has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
Recommended Articles
