Former oilfield services company pivoting to distributed power generation for AI data centers. Leopold holds $86M (1.6% of portfolio). Not in our AGI scoring universe. CIK: 1697500. | Analysis date: 2026-03-12
Leopold Aschenbrenner (Situational Awareness LP) built a $86M position in SEI during Q3-Q4 2025 -- from zero to 1.87M shares. This is a $3.8B market cap company where Leopold is already the 8th largest institutional holder. The company was formerly "Solaris Oilfield Infrastructure" -- a proppant logistics company for fracking -- and renamed itself in September 2024 after acquiring Mobile Energy Rentals and pivoting hard into distributed power generation for data centers. Leopold's thesis is clear: AI needs power, the grid cannot deliver it fast enough, and companies providing behind-the-meter distributed generation are critical infrastructure. SEI has $2.2B in contracted future lease payments and is scaling to 2,200 MW of capacity by early 2028. The question: is this a real business transformation or an oilfield company slapping "AI" on its name?
Solaris Energy Infrastructure operates two distinct businesses that share almost nothing except a corporate parent. Understanding this is critical to valuing the company.
| Revenue (FY2025) | $333.5M (54%) |
| Revenue (FY2024) | $38.6M (12%) |
| Growth YoY | +764% |
| Cost of Revenue | $136.9M (41% of rev) |
| Gross Margin | ~59% |
| Q4 2025 Revenue | 58% of total |
| Q4 2025 Adj. EBITDA | 70% of segment total |
| Operating Lease Income | $272M (FY2025) |
| Customer Concentration | 88% from 1 customer |
This is the entire thesis. SEI provides modular, behind-the-meter power generation equipment (natural gas turbines/generators) to data center operators who cannot wait for grid connections. Revenue is primarily lease income -- they own the generators and rent them. The equipment is scalable, deployable in months (vs years for grid), and can serve as bridge power or permanent distributed generation.
| Revenue (FY2025) | $288.7M (46%) |
| Revenue (FY2024) | $274.5M (88%) |
| Growth YoY | +5% |
| Cost of Revenue | $199.9M (69% of rev) |
| Gross Margin | ~31% |
| Fully Utilized Systems | 93 (vs 91 in 2024) |
The original business. Designs and manufactures specialized equipment for managing proppant (sand) and other raw materials used in hydraulic fracturing. Includes last-mile logistics, field technician support, and software solutions. This business is stable but has no growth story. It generates solid cash flow that partially funds the power solutions buildout. Two customers account for 28% and 12% of segment revenue.
| Contract | Capacity | Term | Start | Details |
|---|---|---|---|---|
| Data Center Customer #1 (900 MW) | ~900 MW | 7 years | 2026 | Long-term commercial arrangement. Revenue expected to commence 2026. Joint venture: Stateline Power LLC (50.1% SEI / 49.9% customer). |
| AI Computing Customer (500+ MW) | 500+ MW | 10 years | 2027 | "Investment grade, global technology company and industry leader in the evolving artificial intelligence computer space." Signed Q1 2026. |
| Additional 500 MW Order | ~500 MW | -- | mid-2027 to early 2028 | Ordered in November 2025. Equipment deliveries expected in tranches. |
| Total Target Capacity | ~2,200 MW | -- | Early 2028 | "The majority of this capacity is currently committed to customers." |
Leopold's portfolio is a roadmap of the AI infrastructure supply chain. Understanding where SEI fits requires looking at his full position set.
| # | Company | Value | % Portfolio | Role in AI Supply Chain |
|---|---|---|---|---|
| 1 | Bloom Energy (BE) | $876M | 15.9% | Fuel cells for data center power |
| 2 | CoreWeave (CRWV) [Call] | $774M | 14.0% | GPU cloud / AI compute |
| 3 | Intel (INTC) [Call] | $747M | 13.5% | Chip manufacturing / foundry |
| 4 | Lumentum (LITE) | $479M | 8.7% | Optical networking for data centers |
| 5 | CoreWeave (CRWV) | $437M | 7.9% | GPU cloud / AI compute (common) |
| 6 | Core Scientific (CORZ) | $419M | 7.6% | Data center infrastructure (activist) |
| 7 | IREN (IREN) | $329M | 6.0% | Bitcoin mining / data center power |
| 8 | Applied Digital (APLD) | $278M | 5.0% | AI data center hosting |
| 9 | SanDisk (SNDK) | $250M | 4.5% | Data storage infrastructure |
| 10 | Cipher Mining (CIFR) | $155M | 2.8% | Bitcoin mining / power infrastructure |
| 11 | EQT Corp (EQT) | $133M | 2.4% | Natural gas producer (fuel for power) |
| 12 | Coherent (COHR) | $89M | 1.6% | Optical components for networking |
| 13 | Solaris Energy (SEI) | $86M | 1.6% | Distributed power generation for DC |
| 14 | Tower Semi (TSEM) | $85M | 1.5% | Specialty chip manufacturing |
| 15 | Riot Platforms (RIOT) | $78M | 1.4% | Bitcoin mining / power infrastructure |
Total portfolio: $5.52B across 29 positions. Q4 2025 (period ending Dec 31, 2025). 15 positions shown.
Reading Leopold's portfolio like a system diagram:
The thesis is complete. Leopold is long the entire stack from fuel extraction through GPU compute. SEI sits at the critical "power generation" layer -- the physical equipment that converts natural gas into electricity at the point of consumption. This is the bottleneck: you can buy GPUs relatively quickly, but you cannot get grid power for 3-5 years.
| Quarter | Shares | Value | % Portfolio | AUM | Action |
|---|---|---|---|---|---|
| Q4 2024 | 0 | -- | -- | $255M | Not in portfolio |
| Q1 2025 | 0 | -- | -- | $1.0B | Not in portfolio |
| Q2 2025 | 0 | -- | -- | $2.1B | Not in portfolio |
| Q3 2025 | 1,150,300 | $46.0M | 1.1% | $4.1B | NEW POSITION |
| Q4 2025 | 1,866,500 | $85.8M | 1.6% | $5.5B | +62% shares added |
Leopold's average cost basis is approximately $37-40 per share based on the Q3 average price and continued buying through Q4. At the current price of $53.33, he's sitting on roughly 35-45% unrealized gain. He increased the position by 62% in Q4, signaling continued conviction.
| Date | Event | Significance |
|---|---|---|
| 2014 | Founded as Solaris Oilfield Infrastructure | Proppant management systems for fracking |
| 2017 | IPO on NYSE as "SOI" | $8-10 range, pure oilfield services |
| 2018-2023 | Stable oilfield logistics business | Revenue $159-320M, single segment |
| Sep 2024 | Acquired Mobile Energy Rentals (MER) | Entered power generation. Paid ~$310M ($122M cash + $186M equity + assumed debt). Added 230 MW deployed capacity. |
| Sep 2024 | Renamed to Solaris Energy Infrastructure (SEI) | Signal: power is now the primary identity |
| 2024 | Formed Stateline Power LLC (50.1/49.9 JV) | Joint venture with first data center customer |
| 2025 | Signed 900 MW / 7-year contract | Massive contract with primary data center customer |
| May 2025 | Issued 4.75% Convertible Notes due 2030 | Capital raise to fund equipment purchases |
| Aug 2025 | Acquired HVMVLV LLC | Added power control & distribution capability |
| Oct 2025 | Issued 0.25% Convertible Notes due 2031 | Additional capital for growth |
| Nov 2025 | Ordered additional ~500 MW of generators | Delivery mid-2027 through early 2028 |
| Q1 2026 | Signed 500+ MW / 10-year contract with AI company | "Investment grade, global technology company... industry leader in AI computing." Revenue from 2027. |
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 | Growth 24-25 |
|---|---|---|---|---|---|---|
| Total Revenue | $159M | $320M | $293M | $313M | $622M | +99% |
| Power Solutions | -- | -- | -- | $39M | $334M | +764% |
| Logistics Solutions | $159M | $320M | $293M | $274M | $289M | +5% |
| Operating Income | -$0.4M | $42M | $50M | $53M | $135M | +156% |
| Operating Margin | -0.2% | 13.1% | 17.0% | 16.9% | 21.8% | -- |
| EBITDA (approx) | $27M | $72M | $86M | $96M | $220M | +129% |
| D&A | $27M | $30M | $36M | $47M | $84M | +79% |
| Interest Expense | $0.2M | $0.5M | $3.3M | $11.8M | $53M* | -- |
| Net Income | -$0.9M | $21M | $24M | $16M | $30M | +91% |
| Net Income (incl NCI) | -$1.3M | $34M | $39M | $29M | $59M* | -- |
*Interest expense increased sharply due to convertible notes (2030: 4.75%, 2031: 0.25%) and Stateline term loan. Net income to Solaris Inc. common stockholders is lower due to noncontrolling interest allocation.
| Total Assets | $2,143M |
| Cash & Equivalents | $353M |
| Accounts Receivable | $138M |
| Inventory | $12M |
| Net PP&E | $1,279M |
| Gross PP&E | $1,637M |
| Construction in Progress | est. $300M+ |
| Goodwill | $105M |
| Other Intangibles | $66M |
| Deferred Tax Asset | $47M |
| Total Liabilities | $982M |
| Current Liabilities | $185M |
| Long-Term Debt | $184M |
| Convertible Notes | est. $575M |
| Stateline Term Loan | est. $300M+ |
| Total Debt | $1,079M |
| Debt-to-Equity | 1.3x |
| Stockholders' Equity | $564M |
| Noncontrolling Interest | $597M |
| Total Equity (incl NCI) | $1,161M |
| Metric | FY2023 | FY2024 | FY2025 | Direction |
|---|---|---|---|---|
| Operating Cash Flow | $88M | $59M | $209M | Strong improvement |
| Capital Expenditures | -$64M | -$188M | -$647M | Massive ramp (equipment purchases) |
| Of which Stateline | -- | -- | -$234M | JV buildout |
| Logistics Solutions | -- | -- | -$7M | Minimal |
| Free Cash Flow | $24M | -$129M | -$438M | Deep negative (investing phase) |
| Investing Cash Flow | -$62M | -$305M | -$686M | Includes acquisitions |
| Financing Cash Flow | -$29M | $400M | $717M | Debt + equity raises |
| Capex Not Yet Paid | $1M | $10M | $92M | Committed but unpaid orders |
The single most important number in SEI's financials is the future minimum lease payments receivable. This tells us what is already contracted and committed.
| Metric | Dec 2023 | Dec 2024 | Dec 2025 | Growth |
|---|---|---|---|---|
| Operating Lease Income (annual) | $0 | $36M | $272M | +656% |
| Future Min. Lease Payments Receivable | $1.4M | $142M | $2,233M | +1,472% |
This progression tells the story: from essentially no lease business in 2023, to $142M in backlog after the MER acquisition in 2024, to $2.2 billion in contracted future lease payments by end of 2025. And the 500+ MW / 10-year AI computing contract signed in Q1 2026 will add hundreds of millions more.
| Variable | Estimate | Source/Basis |
|---|---|---|
| Capex per MW (equipment cost) | $300-500K | Based on total capex / target capacity |
| Revenue per MW per year (lease) | $150-200K | $272M lease income / ~1,400 average deployed MW-months |
| Cost of revenue (% of lease rev) | 41% | FY2025 Power Solutions segment |
| Gross margin on leases | 59% | FY2025 Power Solutions segment |
| Typical contract term | 2-10 years | 10-K disclosure |
| Payback period (simple) | 2-3 years | $400K capex / $150K annual net = ~2.7 years |
| Implied lease ROI (annual) | 35-50% | After cost of revenue, before corporate overhead |
| Scenario | FY2025A | FY2026E | FY2027E | FY2028E | Implied EV/Rev '28 |
|---|---|---|---|---|---|
| Power Solutions | $334M | -- | -- | -- | -- |
| Logistics Solutions | $289M | -- | -- | -- | -- |
| Conservative | $622M | $850M | $1,100M | $1,250M | 3.1x |
| Base Case | $622M | $950M | $1,350M | $1,600M | 2.4x |
| Bull Case | $622M | $1,050M | $1,600M | $2,000M | 1.9x |
Conservative: 2,200 MW at lower utilization/pricing + flat logistics. Base: Full 2,200 MW at expected pricing + logistics stability. Bull: 2,700+ MW including Q1 2026 contract + pricing uplift.
For a 10x return, we need to buy at a price where the terminal value is 10x our entry. Let's work backwards.
| Terminal Scenario (2030-2032) | Revenue | EBITDA Margin | EBITDA | EV/EBITDA | Terminal EV | 10x Entry EV | 10x Entry Price* |
|---|---|---|---|---|---|---|---|
| Conservative | $1.5B | 35% | $525M | 10x | $5.25B | $525M | ~$7 |
| Base | $2.0B | 38% | $760M | 12x | $9.1B | $910M | ~$13 |
| Bull | $2.5B | 40% | $1.0B | 14x | $14.0B | $1.4B | ~$20 |
| Extreme Bull | $3.5B | 42% | $1.47B | 16x | $23.5B | $2.35B | ~$33 |
*Assumes ~71M diluted shares (current ~49M Class A + Class B + convertible dilution). The convertible notes and Class B units create significant potential dilution that must be accounted for.
Bottom line: To get a 10x return from today's price of $53, the company would need to reach an enterprise value of $38B+ -- implying $3B+ in EBITDA. That's a stretch even in the bull case. For 10x to work, you need to buy at $13-20 under the base-to-bull scenario, or the extreme bull case needs to play out from today's price (getting you ~6x). At $53, this is not a 10x setup. At $20, it could be.
| Number of Analysts | 10 |
| Consensus Rating | Strong Buy (1.4/5) |
| Target Low | $61.00 |
| Target Mean | $67.60 |
| Target High | $73.00 |
| Upside to Mean | +27% |
| Period | Price | Context |
|---|---|---|
| Mar 2024 | $8.27 | Pure oilfield company, pre-pivot |
| Jul 2024 | $12.73 | Rumors/announcement of MER acquisition |
| Sep 2024 | $12.48 | MER acquisition closes, renamed to SEI |
| Nov 2024 | $24.10 | Market begins pricing in power thesis (+93%) |
| Dec 2024 | $28.26 | Continued momentum |
| Mar 2025 | $21.49 | Pullback (-24%) |
| Sep 2025 | $39.79 | 900 MW contract announced, Leopold enters |
| Oct 2025 | $52.99 | Peak momentum (+33%) |
| Jan 2026 | $55.06 | Near all-time high ($61.36 ATH) |
| Mar 2026 | $53.33 | Current price, -13% from ATH |
52-week range: $14.27 - $61.36. The stock is up +274% from its March 2025 low of $14.27.
| Holder | Shares | Value | % Held |
|---|---|---|---|
| BlackRock | 4.31M | $230M | 8.8% |
| Vanguard | 2.91M | $155M | 6.0% |
| Encompass Capital | 2.56M | $137M | 5.2% |
| FMR (Fidelity) | 2.29M | $122M | 4.7% |
| Morgan Stanley | 2.09M | $112M | 4.3% |
| Summit Partners | 2.08M | $111M | 4.2% |
| Goldman Sachs | 1.88M | $100M | 3.9% |
| Situational Awareness (Leopold) | 1.87M | $100M | 3.8% |
| Millennium Management | 1.85M | $98M | 3.8% |
| Jane Street | 1.64M | $88M | 3.4% |
Institutional ownership >130% of float (common with convertible arb and dual-class structures).
| Shares Outstanding (Class A) | 48.8M |
| Float | 50.3M |
| Insider Ownership | 6.3% |
| Shares Short | 12.7M |
| Short % of Float | 27.3% |
| Short Ratio (Days to Cover) | 3.93 |
| Prior Month Short | 12.6M |
| Change | +1.0% (slightly increasing) |
27% short interest is very high. For context, most stocks have 2-5% short interest. Over 20% signals significant skepticism. The shorts likely see: (1) an oilfield company with no power generation track record, (2) extreme customer concentration, (3) massive capex requirements with negative FCF, and (4) a stock that's up 5x from March 2025 lows. If the contracts execute as planned, this could squeeze violently. If they don't, the shorts are right.
The transformation is real. SEI has $2.2B in contracted future lease payments, is scaling to 2,200+ MW of power generation capacity, and has signed a new 500+ MW / 10-year deal with an investment-grade AI company. The economics of behind-the-meter power generation for data centers are genuinely attractive: 59% gross margins, multi-year recurring revenue, and a structural time advantage over the grid. Leopold's position alongside 9 other "Strong Buy" analysts adds signal quality.
But the stock already prices in significant success. At $53, the market cap is $3.8B with an EV/Revenue of 6.1x and P/E of 80x trailing. The 27% short interest and deep negative FCF (-$438M in FY2025) reflect real risks around execution, customer concentration, and capital requirements. The stock is up 5x from its March 2025 lows -- much of the pivot has already been priced.
| Conservative (base terminal) | $13 |
| Aggressive (bull terminal) | $20 |
| Current Price | $53.33 |
| Discount Needed | 60-75% |
For a 10x return over 5-7 years, we'd need to buy at $13-20. That's a 60-75% decline from current levels. Not impossible in a market crash or execution stumble, but not something to wait around for.
| FY2027E EBITDA | $450-550M |
| Applied Multiple | 12-14x |
| Implied EV | $5.4-7.7B |
| Less Net Debt | -$726M |
| Equity Value / Diluted Shares | $66-98 |
| Midpoint Fair Value | ~$82 |
| Upside from Current | +54% |
On a forward-looking basis, if the contracts execute, SEI is undervalued relative to FY2027 earnings power. The analyst mean target of $67.60 looks reasonable for a 1-year target; our 2-year estimate is higher.
| Action | Price | Rationale |
|---|---|---|
| Add to Watchlist | NOW | Fascinating business transformation worth monitoring |
| Begin Position (small) | $35-40 | Pullback to Leopold's cost basis. ~30% downside from current. |
| Build Position (larger) | $25-30 | Market panic or execution concerns. Could be 3-4x from here. |
| Back Up the Truck | $15-20 | 10x territory. Would require severe market dislocation or company-specific scare. |
Key insight: SEI is the kind of company we want to own -- a real asset business with contracted revenue, positioned at a critical bottleneck in AI infrastructure. But we don't want to own it at any price. The 27% short interest tells us the stock is volatile and could give us a much better entry. Watch for: (1) a market correction, (2) a customer delay or cancellation, (3) an equipment delivery problem, or (4) a secondary offering that temporarily depresses the stock. Any of these could give us $30-40 entry, which is much more interesting than $53.
| Dimension | SEI (Solaris Energy) | CORZ (Core Scientific) |
|---|---|---|
| Business Model | Equipment owner/lessor (distributed power gen) | Data center operator (colocation/hosting) |
| Asset Type | Power generators (mobile, modular) | Data centers + power infrastructure (fixed) |
| Revenue Model | Operating leases (7-10yr terms) | Colocation fees + power pass-through |
| Leopold Position | 1.6% of portfolio, passive | 7.6% of portfolio, activist (13D, 9.4% ownership) |
| Revenue (FY2025) | $622M (+99%) | $319M (-38%) |
| EBITDA (FY2025) | ~$220M | ~$110M |
| Market Cap | $3.8B | $5.1B |
| Contracted Revenue | $2.2B in future lease pmts | $556M deferred revenue |
| Power Capacity | 2,200 MW target (by 2028) | 1.4 GW (920 MW leasable) |
| Key Risk | Customer concentration (88% from 1) | Mining-to-hosting pivot execution |
| Short Interest | 27.3% | ~10% |
| Relationship | Potentially complementary: SEI provides power TO data centers like CORZ. Leopold may see them as vertically connected -- SEI generates the power, CORZ consumes it. | |
Key file references:
https://www.sec.gov/Archives/edgar/data/1697500/000162828026012501/sei-20251231.htmhttps://www.sec.gov/Archives/edgar/data/2045724/000204572426000002/SALP_13FQ425.xmlhttps://data.sec.gov/api/xbrl/companyfacts/CIK0001697500.json/Users/ravf/projects/work/research/investments/superinvestors/superinvestors.db/Users/ravf/projects/work/research/investments/awb/data/universe/universe.db