5N Plus is the real deal, this analyst says

Ventum Capital Markets analyst Daniel Lavoie says investor meetings with 5N Plus (5N Plus Stock Quote, Chart, News, Analysts, Financials TSX:VNP) reinforced his view that the company’s growth profile is durable and improving.

Lavoie reiterated his “Buy” rating and $44.00 target on 5N Plus in his Aug. 27 update.

“The current setup remains attractive, with several key Specialty Semiconductor facilities effectively committed through the end of 2028 and 5N Plus increasingly positioned as one of the few credible non-Chinese suppliers across a number of critical material markets,” Lavoie said.

He said 5N Plus continues to benefit from its relationship with First Solar, supplying all of the company’s North American cadmium telluride requirements for thin-film solar modules.

Lavoie said the relationship is expanding beyond the original product set, with additional content such as cadmium selenide expected to contribute more meaningfully to revenue in 2027.

Contracted demand provides visibility through 2028, while limited qualified non-Chinese supply and the small cost of 5N Plus products within a finished module support the durability of the relationship.

“We believe the probability of this relationship continuing — and potentially expanding further — remains high as First Solar adds North American capacity,” Lavoie said.

He also said AZUR, 5N Plus’s space solar business, remains a compelling growth platform. Management said the dollar value of current requests for quotation is about twice prior levels, supporting confidence in demand for high-efficiency space solar cells.

Lavoie said additional growth opportunities are emerging in germanium refining and imaging and sensing, including materials used in CT diagnostics.

“Net-net, the meetings strengthened our view that 5N Plus should no longer be valued as a traditional commodity materials producer,” Lavoie said.

The analyst said the company increasingly operates in markets with high qualification barriers, limited suppliers, strong customer relationships and mission-critical products that represent a small portion of customer cost.

Lavoie said the recent pullback has created an attractive entry point, with the stock trading at about 12.4 times his 2027 EV/EBITDA estimate.

He expects 5N Plus to generate Adjusted EBITDA of $109-million on revenue of $487-million in fiscal 2026, improving to Adjusted EBITDA of $136-million on revenue of $554-million in fiscal 2027.

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