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Enphase Energy (ENPH) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research

Enphase Energy (ENPH) closed at $22.08 in the latest trading session, marking a -0.54% move from the prior day. This change lagged the S&P 500's 0.07% loss on the day. At the same time, the Dow added 0.14%, and the tech-heavy Nasdaq lost 0.22%.

Prior to today's trading, shares of the solar technology company had lost 25.45% over the past month. This has lagged the Oils-Energy sector's gain of 3.92% and the S&P 500's gain of 4.58% in that time.

Investors will be hoping for strength from ENPH as it approaches its next earnings release. On that day, ENPH is projected to report earnings of $0.20 per share, which would represent year-over-year growth of 780%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $176.60 million, up 126.41% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $0.54 per share and revenue of $603.50 million. These totals would mark changes of +553.33% and +90.88%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for ENPH. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. ENPH currently has a Zacks Rank of #2 (Buy).

In terms of valuation, ENPH is currently trading at a Forward P/E ratio of 28.03. For comparison, its industry has an average Forward P/E of 22.26, which means ENPH is trading at a premium to the group.

The Solar industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 31, which puts it in the top 13% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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