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Enphase Energy (ENPH) Gains But Lags Market: What You Should Know

Zacks Equity Research

In the latest trading session, Enphase Energy (ENPH) closed at $47.57, marking a +0.25% move from the previous day. The stock lagged the S&P 500's daily gain of 1.54%. Meanwhile, the Dow gained 0.85%, and the Nasdaq, a tech-heavy index, added 1.87%.

Heading into today, shares of the solar technology company had lost 20.49% over the past month, lagging the Oils-Energy sector's loss of 0.57% and the S&P 500's gain of 0.57% in that time.

Wall Street will be looking for positivity from ENPH as it approaches its next earnings report date. On that day, ENPH is projected to report earnings of $0.32 per share, which would represent year-over-year growth of 77.78%. Our most recent consensus estimate is calling for quarterly revenue of $124.37 million, down 7.25% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $1.03 per share and revenue of $705.19 million, which would represent changes of +8.42% and +12.95%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for ENPH. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. ENPH is currently a Zacks Rank #2 (Buy).

Valuation is also important, so investors should note that ENPH has a Forward P/E ratio of 46.14 right now. This valuation marks a premium compared to its industry's average Forward P/E of 27.15.

The Solar industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 71, which puts it in the top 28% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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