I was asked to provide details about my choice of Enphase as the ONE stock I’d buy over at the NPI board. Thought I’d share my response here as well:
I understand your questions regarding Enphase (ENPH). You are certainly not alone, particularly if you’ve not followed Enphase for the last two years. The company skated perilously close (too close for comfort even for me) when it engaged in a price war to maintain market share. Things looked really grim for a while. Consequently, the share price plunged to $0.67 at the low point. Trading in Enphase has been (continues to be) most volatile. That’s why swing trading has been so lucrative for me. Having said all that, I would have walked away from Enphase had the company not laid out a detailed road map to its future.
Just about a year ago, Enphase made a detailed presentation of where it’s going at an Analyst Day. I can offer the slide deck but, if one doesn’t understand the details, it’ll be of limited use. Sorry about that. I feel I should put together a lengthier overview of past, present and future but it’ll take time and cycling season has begun so…
Anyway, long story short, Enphase laid out a solid plan for establishing itself as the most innovative and game-changing inverter provider in the solar market. The company embarked on a program to develop game-changing microinverters. The process was lengthy and expensive. I believe it was worth it and the results will become evident over the course of this year and next.
The company is now marketing its 6th and 7th generation microvinverters. The 6th generation IQ6/6+ is more efficient and cheaper to produce. We’re already seeing the effects in the financials. IQ7/7+ offers a worldwide SKU (it can now be sold world wide in compliance with all extant laws/requirements. IQ7/7+ is now hitting markets that Enphase couldn’t participate in before. Consequently, it’s the microinverters of choice for panel makers that want to offer AC modules (a most popular option).
The big game changer will be the IQ8/8+…the “always on solar system”. Enphase stands alone in offering a system that works both on- or off-grid! This opens up third world markets in a major way. The IQ8 will be hitting the market in Q4 (ahead of schedule). Plenty of investors/panel makers are salivating over this development.
Enphase will be profitable this year and far more profitable in years to come. It leads all competition in the MLPE (module level power electronics) market. Yeppers, it beats SEDG’s optimizers and all others. In light of all this, it’s ridiculously under-priced.
It’s been a long, strange trip. Corporate management is now completely revamped. Big-hitter investors came charging in. The new products are hitting the market (including revamped batteries). I expect to at least double my money from here within a year, and make far more in the future.