Michael Sikand
Investor, Autopilot Portfolio, Founder of Sikand Media
First Solar and Enphase are priced for a no-subsidy world, so a Democratic midterm win could make solar sentiment pop. Democrats are priced at 87%+ to take the House, Trump has been openly anti-solar, and solar stocks have historically surged whenever Democrats make electoral progress. Option implied volatility looks decently low on several setups as the vote nears. x.comÂ
Solar looks much better after five years as dead money, with sentiment shifting, and many zombie names could make investors a lot of money. SpaceX is looking to build a 10GW solar factory in Austin, and a Democratic split of Congress would add further upside. This is the time to do the homework. x.comÂ
Enphase and SolarEdge, dead home-solar stocks, have a credible path through a pivot to solid-state transformers, which @tailrisked calls the future of grid technology. It remains a very speculative play warranting only small positions. x.comÂ
Enphase's US home-solar demand still has not stabilized, delaying its potential home-power recovery to 2027. Q4 revenue guidance of $225-255M is about 20% below the Street at the midpoint, and guided gross margin falls to 40-43% from 45%. Higher electricity costs from AI demand could eventually favor homes generating and storing power; its IQ Battery 5G stores about 50% more energy and costs about 40% less to make. The next two quarters look tough. x.com x.comÂ
SolarEdge and Enphase are both best positioned for solid-state transformers, and both are mid-term accumulation candidates, with no preference yet between them. Per a post the author replies to, Enphase uses Infineon's GaN bidirectional switches for its SST. Their charts suggest the monster move can continue. x.com x.comÂ
Solar is becoming a national priority as the Trump administration reportedly plans a polysilicon price floor and tariffs, and solar may finally catch a bid. First Solar is the play here. x.com x.comÂ
Enphase looks expensive against its earnings, at 35x trailing and 16x next year's versus about 8x for solar companies. Applying 8x to next year's $2.27 EPS gives fair value of roughly $16.50-$21, and the stock trades 69% above the top of that range. The valuation leans on forecasts, with forward earnings 125% above trailing. This is a levels-only read from reported earnings and estimates, without fundamental work. x.comÂ
The Iran war will restart the energy-independence narrative, so demand for SolarEdge and Enphase is bound to grow and start a new cycle. Conviction is high, betting big on the hope that the uptrend is only just starting. x.com x.comÂ
First Solar is the only non-impaired Western solar manufacturer, yet the category leader trades at historically low multiples against its own past and relatively low multiples against basically everything else in the market. Buying it at those valuations is a gift; it looks like a dinger. x.comÂ
First Solar has lost its appeal because of how its bookings have been trending, while power names Vistra and Talen look cheap. x.comÂ
Solar stocks are starting to come back to life, with Enphase, Nextracker, First Solar and SolarEdge in Stage 2 uptrends showing heavy accumulation. They also carry high short interest, and the midterms are approaching. x.comÂ
