Enphase Energy (ENPH) AI Stock Analysis

• Market Cap: $3.52B
• Dividend Yield: N/A
• Average Volume (3M): 8.39M
• Price to Earnings (P/E): 18.6
• Beta (1Y): 0.94
• Revenue Growth: 20.97%
• EPS Growth: 226.98%
• Country: US
• Employees: 2,781
• Sector: Technology
• Sector Strength: 88
• Industry: Solar
• EPS (TTM): 0.90
• Shares Outstanding: 130,859,710
• 10 Day Avg. Volume: 7,708,140
• 30 Day Avg. Volume: 8,394,983
• PEG Ratio: -1.18
• Price to Book (P/B): 11.14
• Price to Sales (P/S): 6.98
• P/FCF Ratio: 19.34
• Enterprise Value/Market Cap: 1.27
• Enterprise Value/Revenue: 2.95
• Enterprise Value/Gross Profit: 6.09
• Enterprise Value/Ebitda: 13.92
• 1Y Price Target: $37.91
• Price Target Upside: 45.14% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 21
• EPS Forecast (FY): 2.79
• Revenue Forecast (FY): $1.47B

• Rating: 61 Neutral
• Price Target: $28.00 ▲(7.20% Upside)

Enphase Energy's overall stock score reflects strong financial performance and reasonable valuation. However, technical indicators suggest bearish momentum, and the earnings call revealed potential short-term challenges, particularly in European markets and upcoming revenue declines.

Positive Factors

Innovative Product Launches

The introduction of new products like the IQ Battery 10C and IQ9 microinverter reflects Enphase's commitment to innovation, which can enhance its competitive edge and drive long-term growth by meeting evolving customer needs and reducing system costs.

Strategic Partnerships

Strategic partnerships, such as the one with Essent, expand Enphase's market reach and enhance its product offerings, potentially increasing revenue streams and market penetration in the renewable energy sector.

New Safe Harbor Agreement

The new safe harbor agreement with a leading TPO provider is expected to generate significant revenue, enhancing Enphase's financial stability and supporting its growth strategy over the next two years.

Negative Factors

European Revenue Decline

A significant decline in European revenue highlights challenges in key markets, potentially impacting Enphase's overall revenue growth and market position in the region, which could affect long-term financial performance.

Guidance for Q4 Revenue Decline

The projected revenue decline in Q4 due to safe harbor revenue shifts and channel destocking suggests potential short-term financial strain, impacting cash flow and operational planning.

Projected Q1 2026 Revenue Drop

The anticipated revenue drop in Q1 2026 due to the expiration of the 25D tax credit poses a risk to Enphase's financial performance, potentially affecting cash flow and necessitating strategic adjustments to mitigate impact.

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, energy storage systems, and related software solutions. The company's primary revenue stream comes from the sale of microinverters, which are critical components of solar photovoltaic systems, enabling the conversion of solar energy into usable electrical power. In addition to microinverters, Enphase offers energy management software that enhances the efficiency and monitoring capabilities of solar systems, generating additional revenue through software licensing and service subscriptions. The company also earns income from the sale of energy storage products, which allow users to store excess energy generated during peak sunlight hours for use when the sun is not shining. Enphase has established strategic partnerships with various solar panel manufacturers and installation companies, which facilitate the adoption of its products and expand its market reach. Furthermore, the growing demand for renewable energy solutions and energy independence contributes to increased sales and revenue growth for the company.

Enphase Energy Financial Statement Overview

Summary

Enphase Energy demonstrates strong profitability and operational efficiency, with improving leverage metrics. However, challenges in revenue growth and cash flow generation could impact future financial flexibility.

Income Statement

Enphase Energy shows a strong gross profit margin of 48.26% TTM, indicating efficient cost management. The net profit margin improved to 12.93% TTM, reflecting enhanced profitability. However, revenue growth is modest at 1.99% TTM, suggesting a slowdown compared to previous periods. EBIT and EBITDA margins are healthy at 15.99% and 21.20% TTM, respectively, showcasing operational efficiency.

Balance Sheet

The company's debt-to-equity ratio has improved to 0.63 TTM, indicating better leverage management. Return on equity is strong at 22.23% TTM, demonstrating effective use of equity. However, the equity ratio is relatively low, suggesting a higher reliance on debt financing.

Cash Flow

Free cash flow to net income ratio is robust at 84.80% TTM, indicating good cash conversion. However, free cash flow growth is negative at -41.75% TTM, highlighting potential cash flow challenges. The operating cash flow to net income ratio is low at 21.88% TTM, suggesting room for improvement in cash generation from operations.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.51B	1.33B	2.29B	2.33B	1.38B	774.42M
Gross Profit	733.27M	629.14M	1.06B	974.60M	554.42M	345.98M
EBITDA	320.64M	210.45M	596.69M	520.26M	196.93M	158.51M
Net Income	195.58M	102.66M	438.94M	397.36M	145.45M	134.00M
Balance Sheet
Total Assets	3.32B	3.25B	3.38B	3.08B	2.08B	1.20B
Cash, Cash Equivalents and Short-Term Investments	1.48B	1.62B	1.70B	1.61B	1.02B	679.38M
Total Debt	1.21B	1.33B	1.30B	1.29B	1.04B	350.62M
Total Liabilities	2.33B	2.42B	2.40B	2.26B	1.65B	716.11M
Stockholders Equity	995.02M	833.02M	983.62M	825.57M	430.17M	483.99M
Cash Flow
Free Cash Flow	217.29M	480.09M	586.38M	698.37M	299.52M	195.78M
Operating Cash Flow	256.25M	513.69M	696.78M	744.82M	352.03M	216.33M
Investing Cash Flow	333.92M	128.27M	-366.36M	-371.91M	-1.22B	-25.57M
Financing Cash Flow	-446.14M	-460.27M	-516.77M	-17.13M	309.41M	191.68M

Enphase Energy Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 26.12
• 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 26.12 is below the 20-day moving average (MA) of 30.69, below the 50-day MA of 34.52, and below the 200-day MA of 43.82, indicating a bearish trend. The MACD of -2.19 indicates Positive momentum. The RSI at 31.10 is Neutral, neither overbought nor oversold. The STOCH value of 2.68 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
SHLS	67 Neutral	$1.35B	40.82	5.86%	―	2.68%	2.90%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
ENPH	61 Neutral	$3.52B	18.61	20.31%	―	20.97%	226.98%
JKS	61 Neutral	$1.36B	―	-17.96%	10.95%	-34.29%	-732.90%
RUN	55 Neutral	$4.40B	―	-59.68%	―	13.79%	-527.48%
ARRY	54 Neutral	$1.09B	―	-7.75%	―	35.75%	37.97%
SEDG	49 Neutral	$2.00B	―	-78.09%	―	-0.14%	66.71%

Enphase Energy Corporate Events

Enphase Energy’s Earnings Call: Strong Gains Amid Challenges

Enphase Energy’s recent earnings call painted a mixed picture of robust achievements and looming challenges. The company celebrated strong revenue performance and innovative product launches, particularly in the U.S. market. However, it also acknowledged significant headwinds, including challenges in European markets, expected revenue declines in Q4, and the anticipated impact of the 25D tax credit expiration in Q1 2026.

Enphase Energy Reports Strong Q3 2025 Earnings

Enphase Energy, Inc., headquartered in Fremont, California, is a global leader in energy technology, specializing in microinverter-based solar and battery systems that enable users to harness solar power efficiently. The company has revolutionized the solar industry with its innovative technology and comprehensive energy solutions.