SolarEdge downgraded to Market Perform from Outperform at BMO Capital

BMO Capital downgraded SolarEdge Technologies to Market Perform from Outperform with a price target of $68, down from $111. The analyst believes distributed solar generation is still a secular growth story, both in Europe and the U.S. However, it has become apparent that the base level of demand in 2022 is not the correct starting point, the analyst tells investors in a research note. The firm previously saw merit and value in looking past a 2023 “air pocket” in demand for SolarEdge. However, its updated view of normalized gross and operating margins during the earnings call disappointed, causing BMO to move to the sidelines.