What In The World Is Going On With Enphase Energy (ENPH) Stock?

Enphase Energy Inc ENPH shares are trading sharply lower by 15.25% to $98.22 Friday morning. Shares of solar-related stocks are trading lower in sympathy with SolarEdge Technologies Inc SEDG, which issued weak preliminary third-quarter outlook. The company also lowered its non-GAAP gross margin guidance.

What Happened With SEDG?

The company lowered its third-quarter revenue forecast to $720-730 million from an initial $880-920 million, with a consensus of $909.02 million. Adjusted gross margin was reduced to 20.1%-21.1% from 28%-31%, and adjusted operating income to $12-31 million from $115-135 million.

These changes were due to unexpected order cancellations and delays from European distributors in the latter part of third-quarter FY23, attributed to high inventory levels and slow installation rates...Read More

Why This Matters To ENPH Investors

Enphase Energy and SolarEdge Technologies are competitors in the solar energy industry. If Solaredge is facing challenges or weakening financial performance, it may indicate that Enphase Energy could face similar pressures. Investors may be concerned about Enphase's ability to compete effectively under these conditions.

The fact that Solaredge lowered its non-GAAP gross margin guidance suggests that there may be pricing pressures or increased costs in the solar industry. This could lead to concerns about Enphase's ability to maintain healthy profit margins, which might lead to a sell-off of its stock.

See Also: Are Global Markets Signaling Pessimism?

According to data from Benzinga Pro, ENPH has a 52-week high of $339.92 and a 52-week low of $111.44.