Analyst David Arcaro of Morgan Stanley maintained a Sell rating on Enphase Energy, with a price target of $32.00.
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David Arcaro has given his Sell rating due to a combination of factors influencing Enphase Energy’s outlook. The company’s second-quarter results for 2025 were strong, but the guidance for the third quarter was mixed, with revenue projections slightly below consensus. This uncertainty is compounded by the lack of clarity regarding the safe harbor rules, as customers await further guidance from the administration, potentially impacting future demand.
Looking ahead to the second half of 2025, there is no sign of accelerating demand, which is concerning given the upcoming expiration of the 25D tax credit in 2026. The company anticipates a potential 20% decline in market installations in 2026, with a significant drop in cash and loan volumes. This challenging outlook, combined with limited visibility into installer strategies and the complexities surrounding safe harbor dynamics, contributes to the Sell rating. Enphase Energy is taking steps to address these challenges, but the overall market conditions remain difficult.
Arcaro covers the Utilities sector, focusing on stocks such as Vistra Energy, DTE Energy, and Talen Energy Corp. According to TipRanks, Arcaro has an average return of 14.6% and a 65.93% success rate on recommended stocks.