Mike
Long-Term Investor, Technology & Crypto
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
Enphase is still a business in contraction: Q2's sequential improvement came almost entirely from safe-harbor shipments booked ahead of tax-credit deadlines, not returning end demand. Those deals pull volume forward, and a tariff refund after the Supreme Court voided IEEPA tariffs flattered GAAP results one time. US revenue, the large majority, is still shrinking. The IQ Solid-State Transformer is an interesting second act, but one clean demand-driven quarter is needed first. 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 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
Enphase is asking for a re-rate before transforming its business, which fundamentally does not work. It sells rooftop hardware to homeowners who just lost the tax credit, and Q1 revenue fell 20% year on year. Its GaN and custom-ASIC power platform for AI is credible engineering, but volume is not until 2028 and the solid-state transformer has zero named customers. Management saying investors value it wrong is the label trying to go first; utility-scale T1 Energy is preferred in solar. x.comÂ
Enphase could squeeze higher as fuel-cell and battery names reprice after Nebius signed a deal with Bloom Energy. Citrini previously flagged Enphase for its high short exposure, and the next resistance appears only around the $120s. x.comÂ
SolarEdge's push into data centers is a massive opportunity, with potential Nebius-like returns if it executes, though that may take a long time. It has laid out a $600M SST revenue target by 2029. The market isn't buying the story yet given execution risk and how slowly its residential battery business has recovered. x.com x.comÂ
SolarEdge could re-rate from a broken solar story to an emerging AI data-center infrastructure play sooner than expected. It set a $600M solid-state transformer revenue target for 2029, far above a ~$250M base case for 2030, and its 800 VDC conversion stage is running under load in the lab, keeping a working system on track for end-2026. A joint white paper with NVIDIA adds credibility, though NVIDIA does not endorse it and there is no pilot customer or order yet. It is a 2027-2028 play. x.com … Show more
Enphase, SolarEdge and Fluence are being sold while their order books grow. Power consumption is expected to rise 65% in a year, yet these energy stocks fell 10% or more in a day; the market just does not see the demand yet. 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