Stifel has kept a Buy rating on FLEX Ltd and set a $75.00 price target after the electronics manufacturer reported fiscal third-quarter 2026 results that surpassed the company’s internal guidance. The firm’s decision follows a quarter in which FLEX posted higher revenue, improved adjusted margins and stronger adjusted earnings per share than management had signaled.
Key reported figures for the quarter include revenue of $7.058 billion, an adjusted operating margin of 6.5% and adjusted EPS of $0.87. Each of those outcomes exceeded the management guidance midpoints of $6.8 billion in revenue, a 6.2% adjusted operating margin, and $0.77 in adjusted EPS. Over the last twelve months, FLEX recorded total revenue of $26.84 billion and diluted earnings per share of $2.23.
Following the quarter, the company raised its fiscal year 2026 guidance and emphasized an ongoing strategic shift away from being a traditional contract manufacturer toward positioning as a higher-value technology enabler, with particular focus on the AI data center ecosystem. Market data from InvestingPro indicates two analysts have increased FY2026 earnings estimates for FLEX, with EPS for that year now projected at $3.31.
Among FLEX’s operating units, the Reliability Solutions segment stood out as a margin contributor. That division posted a 7.2% adjusted operating margin, supported by demand for power and core industrial solutions, even as consumer-facing end markets showed signs of softness. The company’s overall gross profit margin for the last twelve months, however, remains low at 9.27%.
Free cash flow generation was notable in the quarter, with FLEX producing $275 million. The company confirmed it will continue its quarterly share-repurchase program in the $200 million to $300 million range. Management also continued to deepen strategic partnerships with NVIDIA and LG aimed at modular data center designs and thermal management solutions.
InvestingPro data highlights management’s active buyback activity, and notes the stock has delivered a 36.24% total return over the past year. Separately, Raymond James raised its price target on FLEX to $80 after the December quarter results, and maintained an Outperform rating, citing strong datacenter performance. The same firm had previously upgraded FLEX from Market Perform to Outperform, pointing to growth opportunities in cloud and AI infrastructure.
The quarter’s results present a mix of encouraging operational signals and ongoing profitability pressure. While adjusted margins in certain segments and cash generation improved, the relatively weak gross profit margin on a trailing-twelve-month basis underscores a continuing challenge for overall profitability.
Related corporate developments in renewables and manufacturing capacity:
In separate industry activity, Nextpower has advanced multiple projects. The company, in partnership with Abunayyan Holding, established a joint venture named Nextpower Arabia to supply solar tracking systems across the Middle East and North Africa. That joint venture will provide 2.25 gigawatts of solar tracking systems to the Bisha Solar project in Saudi Arabia, which forms part of the country’s National Renewable Energy Program.
In the United States, Nextpower has expanded its Southeast regional hub in Nashville, Tennessee, effectively doubling its solar tracker production capacity. The expansion is expected to support an increase in production and the creation of additional skilled jobs as output ramps up.
Takeaway
Stifel’s reaffirmation of a Buy rating and $75 price target reflects confidence in FLEX’s near-term operational execution and strategic repositioning toward higher-value offerings in AI data center infrastructure. The company’s quarter delivered revenue, margins and EPS above internal guidance, produced meaningful free cash flow, and sustained shareholder returns through buybacks and partnerships. At the same time, company-wide gross profit margins remain constrained, representing a continuing area to monitor for investors and analysts.