SolarEdge move makes ‘strategic sense,’ but more needed, says Citi

After SolarEdge (SEDG) announced the divestiture of its Energy Storage Division, including its 2GWh manufacturing site in South Korea, Citi said the firm expects a positive stock reaction to the announcement, though it “may be temporary.” The firm thinks the move makes strategic sense given domestic content requirements and NCM chemistry of cells produced at the facility and says that while the move will drive about $7.5M per quarter in run-rate savings, “more is needed.” Fierce competition from Chinese players in inverters and modules persists in Europe, where demand is still tepid, adds the analyst, who maintains a Neutral rating and $12 price target on SolarEdge shares.