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Enphase Energy (ENPH)
NASDAQ:ENPH
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Enphase Energy
(NASDAQ:ENPH)68Neutral
Positive Factors
Financial Performance
Enphase Energy announced solid Q4 results, with revenues and earnings per share significantly exceeding expectations.
Manufacturing Capabilities
The company has rapidly ramped up its US-based microinverter manufacturing capabilities, focusing on collecting manufacturing tax credits, which is expected to boost gross margins.
Negative Factors
European Market Performance
European results showed a decline due to sustained weakness in demand for rooftop solar amid decreasing electricity rates in the region.
Enphase Energy (ENPH) vs. S&P 500 (SPY)
Market Cap
$7.66B
Dividend YieldN/A
Average Volume (3M)4.86M
Price to Earnings (P/E)78.4
Beta (1Y)1.65
Revenue Growth-41.92%
EPS Growth-76.24%
CountryUS
Employees2,781
SectorTechnology
Sector Strength48
IndustryRenewable Energy Producers
Share Statistics
EPS (TTM)0.74
Shares Outstanding132,470,500
10 Day Avg. Volume6,014,165
30 Day Avg. Volume4,857,822
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)5.26
Price to Cash Flow (P/CF)10.50
P/FCF Ratio11.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$76.53Price Target Upside32.27% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering24
Enphase Energy Business Overview & Revenue Model
Company DescriptionEnphase Energy, Inc. is an energy technology company that provides energy management technology solutions for the solar photovoltaic industry worldwide. It engages in designing, developing, manufacturing and selling software-driven home energy solutions, which connect energy generation, energy storage and web-based control and communications management services.
How the Company Makes MoneyEnphase Energy generates revenue through the sale of its microinverter systems, which are integrated into solar panels to optimize energy conversion. The company's revenue model is primarily based on the sale of these hardware components to solar installers and distributors. Additionally, Enphase offers energy monitoring and management software, which provides ongoing subscription-based revenue. The company also benefits from the growing demand for solar energy solutions, driven by environmental policies and incentives supporting renewable energy adoption. Partnerships with solar panel manufacturers and installers further expand their market reach and contribute to revenue growth.
Enphase Energy Financial Statement Overview
Summary
Enphase Energy exhibits strong financial health with steady revenue growth and improved margins, despite some pressure on net profitability. The balance sheet is solid with low leverage and high return on equity, though there's room for enhancing equity. Cash flow generation is robust, supporting operational needs and potential investments. Overall, the financials indicate a stable and growing company in the renewable energy sector.Income Statement
Enphase Energy shows strong revenue growth over the years, with a significant increase from $624M in 2019 to $2.29B in 2023. The gross profit margin has improved from 35% in 2019 to 46% in 2023, indicating efficient cost management. However, the net profit margin declined from 25% in 2019 to 19% in 2023, reflecting some pressure on profitability despite revenue growth. EBIT and EBITDA margins remain strong at 19% and 26% respectively in 2023.75
Positive
Balance Sheet
The company's debt-to-equity ratio has been improving, decreasing from 0.39 in 2019 to 0.13 in 2023, which shows reduced leverage risk. Return on equity was strong at 45% in 2023, suggesting effective use of shareholder funds. The equity ratio improved to 29% in 2023, indicating a solid financial structure. Nevertheless, there's room for improvement in increasing equity further.68
Positive
Cash Flow
Enphase Energy's cash flow is robust, with operating cash flow reaching $697M in 2023, up from $139M in 2019. Free cash flow has also shown growth, although more moderate, from $124M in 2019 to $586M in 2023. The operating cash flow to net income ratio is strong, indicating good cash earnings quality. Free cash flow growth has been steady, with some fluctuations in capital expenditures.82
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 1.33B | 2.29B | 2.33B | 1.38B | 774.42M | Gross Profit |
| 629.14M | 1.06B | 974.60M | 554.42M | 345.98M | EBIT |
| 77.29M | 445.74M | 448.26M | 215.83M | 186.44M | EBITDA |
| 210.45M | 589.88M | 513.88M | 192.28M | 204.54M | Net Income Common Stockholders |
| 102.66M | 438.94M | 397.36M | 145.45M | 134.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 1.62B | 1.70B | 1.61B | 1.02B | 679.38M | Total Assets |
| 3.25B | 3.38B | 3.08B | 2.08B | 1.20B | Total Debt |
| 101.29M | 1.30B | 1.29B | 1.04B | 330.87M | Net Debt |
| -267.82M | 1.01B | 817.11M | 918.33M | -348.51M | Total Liabilities |
| 2.42B | 2.40B | 2.26B | 1.65B | 716.11M | Stockholders Equity |
| 833.02M | 983.62M | 825.57M | 430.17M | 483.99M |
| Cash Flow | Free Cash Flow | |||
| 480.09M | 586.38M | 698.37M | 299.52M | 195.78M | Operating Cash Flow |
| 513.69M | 696.78M | 744.82M | 352.03M | 216.33M | Investing Cash Flow |
| 128.27M | -366.36M | -371.91M | -1.22B | -25.57M | Financing Cash Flow |
| -460.27M | -516.77M | -17.13M | 309.41M | 191.68M |
Enphase Energy Technical Analysis
Negative
57.86
Price Trends
65.50
Negative
71.79
Negative
92.94
Negative
Market Momentum
-1.97
Positive
40.13
Neutral
14.92
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ENPH, the sentiment is Negative. The current price of 57.86 is below the 20-day moving average (MA) of 63.09, below the 50-day MA of 65.50, and below the 200-day MA of 92.94, indicating a bearish trend. The MACD of -1.97 indicates Positive momentum. The RSI at 40.13 is Neutral, neither overbought nor oversold. The STOCH value of 14.92 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ENPH.
Enphase Energy Risk Analysis
Enphase Energy disclosed 53 risk factors in its most recent earnings report. Enphase Energy reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Enphase Energy Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $13.66B | 10.92 | 16.20% | ― | 26.75% | 55.24% | |
69 Neutral | $1.17B | 15.73 | 17.10% | 14.02% | -11.91% | -87.40% | |
68 Neutral | $7.66B | 78.38 | 12.32% | ― | -41.92% | -76.24% | |
59 Neutral | $22.39B | 11.53 | -18.05% | 2.31% | 5.00% | -25.89% | |
56 Neutral | $969.32M | ― | -274.38% | ― | -68.86% | -4917.87% | |
53 Neutral | $674.32M | 743.80 | 0.03% | ― | -21.68% | -99.75% | |
46 Neutral | $1.40B | ― | -111.43% | ― | -9.83% | -71.44% |
* Technology Sector Average
Performance Comparison
ENPH
Enphase Energy
58.65
-66.71
-53.21%
CSIQ
Canadian Solar
10.19
-10.16
-49.93%
FSLR
First Solar
131.23
-27.19
-17.16%
JKS
JinkoSolar
22.68
-2.82
-11.06%
SEDG
SolarEdge Technologies
14.84
-55.52
-78.91%
RUN
Sunrun
6.71
-5.53
-45.18%
Enphase Energy Earnings Call Summary
Earnings Call Date: Feb 4, 2025 | % Change Since: -12.66% | Next Earnings Date: Apr 29, 2025
Earnings Call Sentiment Neutral
The earnings call highlights a strong financial performance and successful growth in the U.S. market, supported by new product launches and geographic expansion efforts. However, challenges persist in Europe, particularly in France, and there is a noted decline in battery sales. Overall, the sentiment reflects a balanced outlook with significant achievements tempered by regional challenges.Highlights
Strong Financial Performance
Enphase reported quarterly revenue of $382.7 million, with a gross margin of 53% and generated free cash flow of $159 million.
Successful U.S. Market Growth
U.S. revenue increased by 6% in Q4 compared to Q3, driven by an 11% increase in microinverter sales.
New Product Introductions
Introduction of IQ Battery 5P, IQ8X and IQ8P microinverters, and IQ EV chargers in various markets.
Geographic Expansion
Expanding presence in Europe, India, Vietnam, Malaysia, Thailand, and the Philippines with new products.
Improved Customer Service Metrics
Net Promoter Score at 78%, with average call wait time dropping to 2.8 minutes from 4.4 minutes.
Lowlights
Decline in European Revenue
European revenue was down 25% in Q4 compared to Q3, with a 13% overall sell-through decline.
Challenges in France
Market slowdown due to utility rate cuts, impacting short-term growth potential.
Battery Sales Decrease
Battery sales were down 8% in Q4 compared to Q3 due to lesser channel restocking.
Company Guidance
During the Enphase Energy's Fourth Quarter 2024 Financial Results Conference Call, the company provided several key metrics and guidance for the upcoming period. For Q4 2024, Enphase reported a revenue of $382.7 million, with shipments of approximately 2 million microinverters and 152-megawatt hours of batteries. The company achieved a non-GAAP gross margin of 53%, with operating expenses at 22% of revenue, and a net promoter score of 78%. Looking ahead, for Q1 2025, Enphase expects revenue between $340 million and $380 million, including $50 million of safe harbor revenue. They plan to ship 150-170 megawatt hours of IQ batteries. The company also highlighted their manufacturing capacity, with 7.25 million microinverters per quarter globally, and anticipated to ship 1.2 million units from U.S. facilities in Q1. Enphase remains focused on introducing new products, including the IQ9 microinverters in the second half of 2025, and improving their supply chain to maximize domestic content opportunities.Enphase Energy Corporate Events
Business Operations and Strategy
Enphase Energy Restructures for Efficiency and Innovation
Neutral
Nov 8, 2024
Enphase Energy is implementing a restructuring plan to align its workforce with business needs, impacting 17% of its global staff. The company is focusing on operational efficiencies by consolidating manufacturing to four locations, ceasing operations in Mexico, and reducing costs through automation and AI. Despite industry challenges, Enphase remains committed to innovation with new products in the pipeline and aims to lower operating expenses for 2025, while supporting affected employees with severance packages.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.