“We have generally maintained the view that ENPH remains at risk of share loss against SEDG despite benefiting from strong growth of the US market and believe increasing pricing pressure could mitigate the rapid growth in some of the smaller customer segments,” writes Deutsche’s Vishal Shah, downgrading Enphase to sell and cutting his target in half to $3.Shah: "While we expect longer term [gross] margins to remain in the 35-40% range, we believe margins could come under pressure in the near term and decline to the high 20s as ENPH focuses on top line growth and share gains … Until the company releases new lower cost Gen 5 products (version 2) in late 2016, we expect downside risk to margins and estimates.“SolarEdge , which counts top U.S. residential solar installers SolarCity, Sunrun, and Vivint as clients, has been easily outgrowing Enphase in recent quarters. SolarEdge’s sales rose 121% Y/Y to $98.4M in calendar Q2, while Enphase’s rose 25% to $102.1M.A lot of competitive/margin concerns have already been priced into Enphase’s shares: They’re now down 71% YTD, and trade for less than 0.5x a 2015 sales consensus of $406.3M.”
Nice to know this information.
Thank you for sharing.
Curious to know if anyone here follows or owns ENPH. It was mentioned previously here as an alternative to SEDG given its cheap share price. This action today based on a sell rating by DB seems a little over done as there was no new info offered that hasn’t already been out in the open for many months now. While SEDG appears to have convinced many that it has the superior product, it seems that there is at least some debate out there. Anyone here have thoughts/comments on ENPH? Is SEDG’s offering so superior to make ENPH obsolete, or is there room for 2 leaders in this space?
Anyone here have thoughts/comments on ENPH? Is SEDG’s offering so superior to make ENPH obsolete, or is there room for 2 leaders in this space? - Jeff
As a matter of fact, I’m highly invested in ENPH (25% of my portfolio). Back in June, I offered my views on ENPH/SEDG (post #9406). Back then, ENPH was a 12% holding. It has grown considerably as the share price was beaten down. As you can well imagine, with a position that large, I do a LOT of daily research. It would make for a truly long post if I were state my reasons for being bullish on ENPH. Rather than subject everyone to endless scrolling, I’ll simply offer some of the headlines regarding ENPH that hit my screen in the past two months:
Enphase Energy Signs Strategic Partnership with Solar Partners New Zealand
BUSINESS WIRE – 5:00 PM ET 08/24/2015
Enphase Energy Named Top PV Inverter Brand in France and Benelux by EuPD Research
BUSINESS WIRE – 5:30 AM ET 09/01/2015
WattzOn Announces Integration With Enphase, Providing a Complete and Engaging Home Energy Management to Enphase Residential Customers
MARKET WIRE – 2:56 PM ET 09/02/2015
Cowen Securities LLC initiates coverage for ENPHASE ENERGY INC with BUY recommendation.
INVESTARS ANALYST ACTIONS - PUBLIC – 9:08 AM ET 09/03/2015
Enphase Energy Launches the Next-Generation Envoy-S
BUSINESS WIRE – 9:00 AM ET 09/08/2015
AT&T Improves Solar Energy Management With Enphase Energy Using IoT Technology
PR NEWSWIRE – 9:00 AM ET 09/08/2015
Oppenheimer & Company initiates coverage for ENPHASE ENERGY INC with OUTPERFORM recommendation.
INVESTARS ANALYST ACTIONS - PUBLIC – 6:05 PM ET 09/08/2015
Enphase Energy Services Surpasses One Gigawatt of Systems Serviced
BUSINESS WIRE – 9:00 AM ET 09/10/201
Enphase Energy Services Announces 100% System Availability O&M Offering for Commercial Systems
BUSINESS WIRE – 9:00 AM ET 09/14/201
Analyst Actions: Enphase Energy Price Target Cut To $10 At Needham, Reiterated Strong Buy
MIDNIGHTTRADER – 9:17 AM ET 09/15/2015
JinkoSolar Offers Bundle with Enphase Energy for Commercial Customers
PR NEWSWIRE – 7:00 AM ET 09/16/2015
Enphase Energy Unveils Its Home Energy Solution in Australia and New Zealand
BUSINESS WIRE – 11:00 AM ET 10/06/2015
Genesis Energy to Trial Distributed Residential Energy Storage System With the Enphase Home Energy Solution
BUSINESS WIRE – 11:02 AM ET 10/06/2015
Zacks Investment Research, Inc. upgrades ENPHASE ENERGY INC from HOLD to BUY.
INVESTARS ANALYST ACTIONS - PRIVATE – 7:13 AM ET 10/07/2015
Here’s a summary article regarding analysts opinions:
Shares of Enphase Energy (NASDAQ:ENPH) have been assigned a consensus rating of “Hold” from the sixteen research firms that are currently covering the stock, MarketBeat.Com reports. Three research analysts have rated the stock with a sell rating, three have given a hold rating, eight have given a buy rating and one has assigned a strong buy rating to the company. The average 1-year target price among brokers that have updated their coverage on the stock in the last year is $12.99.
Suffice it to say, given all the shares I’ve purchased at < $4, my total position is well below the lowest analyst projections…except for the DB analyst’s blast today.
There’s been lots of discussion regarding short attacks on this board. This one was a classic. As of September 30, approx. 19% of ENPH shares were held short. The company will report earnings on November 3 and, therefore, is in its quiet period. Given ENPH’s aggressive development/deployment of new technologies around the globe, there’s a reasonable chance that ENPH will beat analyst estimates (as it has for more the 12 quarters running). DB did the shorts a favor. As for the analyst himself? Mr. Vishal Shah boasts a “Zero-Star” rating, being wrong with his analyses more than 80% of the time.
Mr. Shah did me a favor, too. I had sold a number of shares recently after quick 20% gains (the position size was getting out of hand). I just couldn’t resist replacing those shares at a cost of $3.80 (a 30% discount).
May we all live long and prosper.
As a matter of fact, I’m highly invested in ENPH (25% of my portfolio)
Wow! Saul sets a limit at 20%, 25% in a speculative stock is super ballsy. Buying all the way done is too. Hope you don’t have any other Solar holdings and good luck. I could never tell my wife I had 25% of my investment in something like that, and I suppose that is my sanity check
Thanks for the reply. I recall your prior post was what got me interested the stock, and I’ve since done a lot of my own reading. (Quick plug for MF and these boards: it’s much more difficult finding useful information on one’s own out there in the wild if a company is not actively being discussed on these boards). The market seems to be nearly pricing them for bankruptcy, but my impression is similar to yours in that they appear to have more growth ahead of them. At the very least, their press releases give the impression they are not dead yet.
Quite contrary to Saul’s approach, it seems one could do reasonably well in the stock if the company simply proves they are still viable. I’ve been historically drawn to these “good deals” in the past, but like a moth to a flame I’ve often suffered a similar fate. This is why I am also drawn to Saul’s method of trying to pick proven winners, since my “losers” don’t always work out.
May we all live long and prosper. Hear hear.
Not phased by a 25% position, but we all have our own tolerance for risk.
Curious if you know what happened to ENPH today? Down 13% on heavy volume.
I have no idea why ENPH dropped so much today. I searched for news but found nothing. I will note that the entire energy complex had a bad, very bad, day. Oil sector stocks were down across the board. Same for solar sector stocks.
We won’t have to wait long to discover if the shorts were right or wrong. Earnings reports next week (both ENPH and SEDG). I expect both companies to fare well.
Curious if you know what happened to ENPH today? Down 13% on heavy volume.
Natural gas was down 10% yesterday.
Yep Solar took a hit today! Solarcity was also down quite a bit.