SolarEdge Stock Is Spiraling Lower: What's Going On?

SolarEdge Technologies Inc SEDG shares are getting burned Wednesday after the company reported second-quarter financial results and issued weak third-quarter guidance. Multiple analysts also cut price targets following the print. 

• Q2 Revenue: $991.3 million beat estimates of $989.17 million
• Q2 EPS: $2.62 beat estimates of $2.55

GAAP gross margin came in at 32%. GAAP operating income totaled $150.4 million.

SolarEdge said it shipped 4.3 Gigawatts (AC) of inverters during the quarter and 269 MWh of batteries.

The company ended the quarter with cash, equivalents, bank deposits, restricted bank deposits and marketable securities of $853.5 million.

"We are pleased with our results for the second quarter, in particular our strong performance in Europe in both the residential and commercial solar segments," said Zvi Lando, CEO of SolarEdge.

"While the U.S. residential solar market is currently seeing some headwinds primarily related to higher interest rates, we are navigating through this period by leveraging our geographic and multi-segment strengths in the solar markets and expect to benefit from the positive long-term outlook for this sector."

Outlook: SolarEdge said it expects third-quarter revenue to be in the range of $880 million to $920 million versus estimates of $1.05 billion. Adjusted gross margin is expected to be between 28% and 31%. 

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Analyst Changes:

• Barclays analyst Christine Cho maintained SolarEdge with an Overweight and lowered the price target from $359 to $274.
• Oppenheimer analyst Colin Rusch maintained SolarEdge with an Outperform and lowered the price target from $400 to $314.
• Goldman Sachs analyst Brian Lee maintained SolarEdge with a Buy and lowered the price target from $414 to $353.

SEDG Price Action: SolarEdge shares were down 14.3% at $205.34 at the time of writing, according to Benzinga Pro.

Photo: Bruno from Pixabay.