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What Awaits SolarEdge Technologies (SEDG) in Q2 Earnings?

Zacks Equity Research

SolarEdge Technologies, Inc. SEDG is set to report second-quarter 2019 results on Aug 6, after market close.

In the last reported quarter, the company witnessed a positive earnings surprise of 3.23%. However, the bottom line missed the Zacks Consensus Estimate in two of the trailing four quarters, the average negative surprise being 3.32%.

Let’s see how things are shaping up prior to this announcement.

Factors at Play

Of late, SolarEdge Technologies has been benefiting from the growing commercial and residential solar installations in the United States. This is evident from the increase in the number of inverters and power optimizers sold by the company over the last few quarters.
 
Significant growth opportunities in Europe, Australia and Israel have been driving the company’s revenues for the last couple of quarters.

Cumulatively, the aforementioned factors are likely to bolster the company’s revenues in the to-be-reported quarter as well. In line with this, the Zacks Consensus Estimate for second-quarter revenues is pegged at $315 million, indicating an increase of 38.8% from the prior-year quarter’s reported figure.

The company has been making significant efforts to reduce actual support costs, primarily by deploying tighter control support operations and reducing support-related logistics expenses. Such cost initiatives are likely to drive its bottom line.

In line with this, the Zacks Consensus Estimate for second-quarter earnings is pegged at 86 cents, implying rise of 4.9% from the year-ago quarter’s reported figure.

As the integration related to the Kokam Co. and the S.M.R.E. Spa acquisitions is still underway, we don’t expect revenues in the to-be-reported quarter to reflect the contribution from these buyouts. However, expenses and cost of product adjustments related to these acquisitions may have a negative impact on the bottom line.

What the Zacks Model Unveils

Our proven model does not conclusively predict that SolarEdge Technologies is likely to beat estimates in the second quarter. This is because a stock needs to have both — a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — for this to happen.

Earnings ESP: SolarEdge Technologies has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Note that we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

SolarEdge Technologies, Inc. Price and EPS Surprise

 

SolarEdge Technologies, Inc. Price and EPS Surprise

SolarEdge Technologies, Inc. price-eps-surprise | SolarEdge Technologies, Inc. Quote

An Upcoming Solar Earnings

Sunrun Inc. RUN is scheduled to report quarterly numbers on Aug 7.

Recent Solar Releases

SunPower Corp. SPWR incurred adjusted loss of 22 cents per share in the second quarter, wider than the Zacks Consensus Estimate of a loss of 9 cents. The company incurred a loss of a penny per share in the year-ago quarter.

Enphase Energy, Inc. ENPH reported second-quarter 2019 adjusted earnings of 18 cents per share, which surpassed the Zacks Consensus Estimate of 13 cents by 38.5%. The bottom-line figure, moreover, improved from a penny in the prior-year quarter.

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SolarEdge Technologies, Inc. (SEDG) : Free Stock Analysis Report
 
Sunrun Inc. (RUN) : Free Stock Analysis Report
 
SunPower Corporation (SPWR) : Free Stock Analysis Report
 
Enphase Energy, Inc. (ENPH) : Free Stock Analysis Report
 
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