Revenues up just 120% year over year.
Adjusted earnings of 31 cents, up 55% SEQUENTIALLY, and up from a loss the year before.
Nothing more to say
Saul
8 Likes
Revenues up just 120% year over year.
Adjusted earnings of 31 cents, up 55% SEQUENTIALLY, and up from a loss the year before.
Nothing more to say
Saul,
I didn’t buy this one because gross margins were too low…they were still in the 20s percent range last quarter. I was concerned about price reductions could very quickly erase profits which could put them in danger of not covering their OpEx. How did GMs look last quarter?
Chris
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Press release Here: http://seekingalpha.com/pr/14394626-solaredge-announces-fisc…
Non-GAAP 4Q15 (June 30) EPS $0.31
Fiscal Highlights (from press release)
Fourth Quarter and Full Fiscal Year 2015 Highlights
- Record revenue for fiscal Q4 2015 of $98.4 million, up 13.9% from the prior quarter and 120.8% from fiscal Q4 2014. Record revenue for fiscal year 2015 of $325.1 million, representing a 144.0% year-over-year growth
- GAAP gross margin of 28.7% for fiscal Q4 2015 and 25.2% for fiscal year 2015
- GAAP net income for fiscal Q4 2015 of $9.3 million, and net income for fiscal year 2015 of $21.1 million
- Non-GAAP net income for fiscal Q4 2015 of $13.8 million and net income for fiscal year 2015 of $29.4 million
- 284 Megawatts (AC) of inverters shipped for fiscal Q4 2015 and 920 Megawatts (AC) for fiscal year 2015
6 Likes
up 8% during the day and another 11.5% after hours. congrats.
Chart Chat
http://stockcharts.com/freecharts/gallery.html?sedg
SEDG is a relatively new IPO, just around long enough to sport a 50dma, but not a 200dma. IPOs are a great place to look for fast growing stocks with new technology that might disrupt old fogies.
SEDG ran nice and strong after the IPO and never took a nice rest to present growth investors a chance to buy after a good base. (Often IPO bases are shorter than those for established stocks and it is ok to buy breakouts from those bases). But here we have a nice long base starting to round out nicely (on the weekly chart). This jump after earnings will not put the stock in an extended position that is too expensive to buy. Instead it should create a high volume accumulation day within the base and even take the stock back above the 50 dma tomorrow. Growth investors that buy on breakouts want to see more accumulation on the right-side of the base than distrubtion on the left side as it fell. This is the start of it. They will be looking for a nice round bottom to form a cup-base or even better a cup-with-handle. Then when it breaks out of the base on stong volume, all those guys will jump in.
Bottom line for us, keep buying the good stocks based on Saul’s rules, but look at this as a possible turnaround point for the next big run. I may take my first nibble tomorrow, then look for other spots, including a strong breakout to new highs in 4-8 weeks. If it stays above the 50dma for a few days I might add more (especially if the market is dropping and SEDG is staying strong).
Blah, blah, blah, jibberish and chicken bones!
6 Likes
Chris, Gross margins were low because sales were increasing over 100%. To keep up with orders they had to ship by air often, work lots of overtime, the usual. To overcome that they have been increasing manufacturing capacity, etc. Margins this quarter were 28.9%, up from 19.6% the year before and from 27.6% sequentially.
By the way, I multiply all the adjusted nets by the current number of shares instead of the average (more conservative as they had the IPO) and I get trailing earnings of 66 cents for the year, instead of 77 cents.
Saul
2 Likes
Gross margins were low because sales were increasing over 100%. To keep up with orders they had to ship by air often, work lots of overtime, the usual. To overcome that they have been increasing manufacturing capacity, etc. Margins this quarter were 28.9%, up from 19.6% the year before and from 27.6% sequentially.
Thanks Saul. Have you tried to quantify the extra costs to ship, work overtime, etc? What would the margins have been if they didn’t have these growing pains? Also, how much can they save in the future from economies of scale? Are there any other reason why margins will go up? I think that gross margins are very important and high GMs demonstrate pricing power and a product offering that differentiated (avoids future commoditization).
I believe that solar is here to stay and will grow very rapidly for years as it replaces other forms of energy production. Besides economic reasons (as solar gets cheaper and cheaper), a strong effort to combat global warming will be a crucial driver, IMO. So, I feel very convinced that the market for solar will experience very good growth. Right now the low margins on SEDG have kept me out. I wish I could be convinced that margins can trend at least into the 40s percent range. It seems to me that SEDG management has had plenty of time (more than a year) to solve logistical issues such as shipping and labor allocation efficiencies, and if they were capable to getting much higher margins then they would have done so already. I could be wrong, but right now I see that they could be vulnerable to pricing pressures from competitors or from price concessions to their very concentrated customers.
Chris
5 Likes
up 8% during the day and another 11.5% after hours.
But now down today 12%? How weird. Did I miss some news?
Brian
yeah I’m kind of wondering the same thing.
I just kept buying. Bought a full position.
Are the instituitonal investors not back from vacation yet?
But now down today 12%? How weird. Did I miss some news?
I could not find anything.
What I don’t like is a reversal like that on strong volume. It touched the 50dma and got scared and ran. Why did so many want to sell? Have they been waiting to get out? Is it related to China? No news on Yahoo since 9:14am this morning. The stock is the stock and the company is the company, but a lot of people are thinking the same thing for some reason.
I believe that investors are concerned about the end of the tax credit in 2016 and a collapse in the stock price after the run up to buy before the end of the tax credit.
3 Likes
I believe that investors are concerned about the end of the tax credit in 2016 and a collapse in the stock price after the run up to buy before the end of the tax credit.
Was this tax credit information made public to investors today? The stock has bounced from $27 to $34 a share for the past 5 weeks dealing with declining oil prices; the present quarter was a blowout with 55% increased EPS SEQUENTIALLY and increased revenue of 120% YoY [footnote post 11102, credit: Saul].
I watched this stock relentlessly today and noticed a lot of selling right after the lunch hour, so much so that the stock price dropped about $1.50 in a 10 minute period. Is that when the tax credit 2016 information came out?
Was this tax credit information made public to investors today? I watched this stock relentlessly today and noticed that the stock price dropped about $1.50 in a 10 minute period. Is that when the tax credit 2016 information came out?
Hi sweetadeline, I wasn’t sure whether you were being ironic or serious with your question, but the possible end of the tax credit in 2016 has been known forever.
Saul
The end of the tax credit was not new news yesterday, but two analysts at Avondale and Casual Analyst downgraded yesterday expressing concerns about it. See, e.g., http://seekingalpha.com/article/3436246-solaredge-great-quar…
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The end of the tax credit was not new news yesterday, but two analysts at Avondale and Casual Analyst downgraded yesterday expressing concerns about it.
Casual Analyst is not an analyst, but just an individual investor like us. He writes articles for Seeking Alpha.
Saul
This is cross posted from the SEDG yahoo finance board:
*******Options - Just an FYI
Perhaps others have noticed but have not mentioned that there is currently open interest of about 5,000 option call contracts for SEDG. Contracts for a half-million shares makes for a significant profit for those who sold the contracts.
The bulk of current outstanding call contracts are strike priced at $35 and $40 so the sellers will likely keep the price for which they sold those contracts as share price has been driven comfortably below that.
A limited number of shareholders have the ability to sell that kind of volume of covered calls. If you were one of those institutions, you would benefit from share price remaining low until those contract expire next Friday, August 21st. Bravo!
It is legal for an institution to:
-sell option contracts on their shares
-then short their own shares (this may affect share price in a way that favors the contracts sold)
-cover short interest following expiration.
Short interest and buys to cover, are not publicly identified to the institutions that are executing.
Meanwhile, enjoy the discount pricing available for accumulating shares, or buying December contracts. This pricing may not last far beyond August 21st*******
Perhaps this explains the illogical correlation between SEDG’s stock price and their blowout quarter…
6 Likes