Enphase Energy (ENPH) AI Stock Analysis

• Market Cap: $4.72B
• Dividend Yield: N/A
• Average Volume (3M): 8.69M
• Price to Earnings (P/E): 28.4
• Beta (1Y): 1.03
• Revenue Growth: 4.39%
• EPS Growth: 37.70%
• Country: US
• Employees: 2,781
• Sector: Technology
• Sector Strength: 88
• Industry: Solar
• EPS (TTM): 0.69
• Shares Outstanding: 130,750,780
• 10 Day Avg. Volume: 10,774,778
• 30 Day Avg. Volume: 8,691,173
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.07
• Enterprise Value/Revenue: 3.42
• Enterprise Value/Gross Profit: 7.12
• Enterprise Value/Ebitda: 17.02
• 1Y Price Target: $40.03
• Price Target Upside: 10.95% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 22

• Rating: 75 Outperform
• Price Target: $42.00 ▲(16.41% Upside)

Enphase Energy's strong financial performance and strategic initiatives in product innovation and global expansion are significant strengths. However, technical indicators suggest mixed momentum, and valuation metrics indicate a premium price. The earnings call provided positive guidance but also highlighted potential challenges, such as tariff impacts and market contraction.

Positive Factors

Product Innovation

Continuous innovation in battery systems enhances product efficiency and market competitiveness, supporting long-term growth and customer retention.

Global Expansion

Expanding market presence in Europe and other regions diversifies revenue streams and reduces dependency on any single market, strengthening global market position.

Enhanced Digital Platform

Improvements to the Solargraf platform streamline operations for solar installers, potentially increasing adoption and sales, while expanding into new markets like Japan.

Negative Factors

Tariff Impacts

Tariff impacts can erode profit margins, increasing costs and potentially affecting pricing strategies, which could hinder competitiveness and profitability.

Elevated Inventory Levels

Higher inventory levels may indicate slower sales or overproduction, leading to increased holding costs and potential write-downs if demand does not meet expectations.

Market TAM Reduction

A projected market contraction due to policy changes could limit growth opportunities, requiring strategic adjustments to maintain revenue and market share.

Enphase Energy Business Overview & Revenue Model

Company Description

Enphase Energy, Inc., together with its subsidiaries, designs, develops, manufactures, and sells home energy solutions for the solar photovoltaic industry in the United States and internationally. The company offers semiconductor-based microinverter, which converts energy at the individual solar module level, and combines with its proprietary networking and software technologies to provide energy monitoring and control services. It also offers AC battery storage systems; Envoy communications gateway; and Enlighten cloud-based monitoring service, as well as other accessories. The company sells its solutions to solar distributors; and directly to large installers, original equipment manufacturers, strategic partners, and homeowners, as well as through its legacy product upgrade program or online store. Enphase Energy, Inc. was incorporated in 2006 and is headquartered in Fremont, California.

How the Company Makes Money

Enphase Energy generates revenue primarily through the sale of its microinverters and energy storage systems. The company offers a range of products that cater to residential and commercial markets, which includes not only the hardware but also software solutions that enable monitoring and management of solar energy systems. Key revenue streams include product sales, installation services, and recurring revenue from software subscriptions that provide ongoing monitoring and analytics. Additionally, Enphase benefits from partnerships with solar distributors, installers, and energy companies, which help expand its market reach and drive sales. The growing demand for renewable energy solutions and government incentives for solar adoption further contribute to Enphase's earnings.

Enphase Energy Financial Statement Overview

Summary

Enphase Energy shows strong profitability with a gross profit margin of 47.7% and a net profit margin of 12.8%. The balance sheet is stable, with a moderate debt-to-equity ratio of 0.78. Cash flow is robust, but growth has slightly decreased. Key risks include moderate leverage and slowing revenue growth.

Income Statement

Enphase Energy's income statement reflects strong profitability and revenue growth. The TTM gross profit margin stands at 47.7%, indicating efficient cost management. Furthermore, the net profit margin has improved to 12.8% in TTM. However, the revenue growth from 2024 to TTM is 7%, a slowdown compared to previous years, which could suggest market saturation or increased competition. EBIT and EBITDA margins are healthy at 9.8% and 15.5%, respectively, showing robust operational efficiency.

Balance Sheet

The balance sheet shows a stable financial position with a debt-to-equity ratio of 0.78, indicating moderate leverage. The return on equity is strong at 22.5% in TTM, reflecting effective use of shareholder funds. However, the equity ratio of 26.1% suggests a reliance on liabilities, which could pose risks if market conditions change.

Cash Flow

Cash flow analysis reveals robust free cash flow, standing at $472 million in TTM, but the growth rate has slightly decreased by 1.7% from the previous period. The operating cash flow to net income ratio is 2.81, indicating strong cash generation relative to accounting profits. However, the free cash flow to net income ratio of 2.58 suggests that not all cash flows are translating into free cash, potentially due to reinvestments or capital expenditures.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.33B	2.29B	2.33B	1.38B	774.42M
Gross Profit	629.14M	1.06B	974.60M	554.42M	345.98M
EBITDA	210.45M	589.88M	513.88M	192.28M	204.54M
Net Income	102.66M	438.94M	397.36M	145.45M	134.00M
Balance Sheet
Total Assets	3.25B	3.38B	3.08B	2.08B	1.20B
Cash, Cash Equivalents and Short-Term Investments	1.62B	1.70B	1.61B	1.02B	679.38M
Total Debt	1.31B	1.30B	1.29B	1.04B	330.87M
Total Liabilities	2.42B	2.40B	2.26B	1.65B	716.11M
Stockholders Equity	833.02M	983.62M	825.57M	430.17M	483.99M
Cash Flow
Free Cash Flow	480.09M	586.38M	698.37M	299.52M	195.78M
Operating Cash Flow	513.69M	696.78M	744.82M	352.03M	216.33M
Investing Cash Flow	128.27M	-366.36M	-371.91M	-1.22B	-25.57M
Financing Cash Flow	-460.27M	-516.77M	-17.13M	309.41M	191.68M

Enphase Energy Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 36.08
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ENPH, the sentiment is Negative. The current price of 36.08 is below the 20-day moving average (MA) of 37.86, below the 50-day MA of 36.14, and below the 200-day MA of 50.40, indicating a bearish trend. The MACD of 0.11 indicates Positive momentum. The RSI at 44.21 is Neutral, neither overbought nor oversold. The STOCH value of 14.76 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ENPH.

Enphase Energy Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ENPH	75 Outperform	$4.72B	28.42	19.79%	―	4.39%	37.70%
SHLS	67 Neutral	$1.26B	59.38	4.26%	―	-11.95%	-7.87%
ARRY	64 Neutral	$1.26B	-4.72	-57.01%	―	6.36%	-1683.09%
JKS	61 Neutral	$1.21B	-4.82	0.27%	11.45%	-30.26%	-156.69%
RUN	57 Neutral	$4.10B	-1.53	-87.71%	―	3.27%	-81.63%
SEDG	51 Neutral	$2.24B	-1.26	-334.37%	―	-36.07%	-233.14%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%