Energy technology company Enphase Energy, Inc. (ENPH) caters to the solar photovoltaic industry through its energy management solutions. While ENPH shares have declined 27.9% so far this year, it delivered stellar results for the fourth quarter.
Revenue surged 55.8% year-over-year to $412.7 million, outperforming estimates by $12.8 million. Earnings per share at $0.73 beat estimates by $0.14. This robust performance was attributable to growth in geographies across Europe, Asia & the Pacific as well as Latin America. Further, product offerings in Australia are expected to commence in H2 2022.
Moreover, in February, the company announced it has witnessed increased deployments of Enphase Energy Systems in Ohio as well as Utah. Additionally, Enphase has partnered with Swell Energy to participate in the latter’s distributed, virtual power plant programs across California, New York, and Hawaii.
With this slew of developments in mind, let us take a look at the changes in ENPH’s key risk factors that investors should know.
Risk Factors
According to the TipRanks Risk Factors tool, ENPH’s top risk category is Finance & Corporate, contributing 20 of the total 59 risks identified for the stock, compared to a sector average of 16 risk factors under the same category.
In its recent report, the company has added one key risk factor under the Finance & Corporate risk category.
ENPH noted that at the end of December 2021, it had ~$897.3 million in debt security investments comprising of money market funds, U.S. Treasuries, U.S. government securities, commercial paper, and debt securities of corporations. The company does not use derivative instruments to adjust its portfolio and consequently is exposed to general credit, liquidity, market, and interest rate risks.
Additionally, if the global credit market sees volatility or deteriorates, then ENPH’s investment portfolio may see an impact, in turn affecting its operating results and position.
Hedge Fund Activity
According to TipRanks data, the Wall Street’s top hedge funds have increased holdings in Enphase by 6.4 thousand shares in the last quarter, indicating a positive hedge fund confidence signal in the stock based on activities of 10 hedge funds.
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