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SolarEdge Technologies (SEDG)
NASDAQ:SEDG
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SolarEdge Technologies
(NASDAQ:SEDG)47Neutral
Positive Factors
Free Cash Flow
SolarEdge posted positive free cash flow in the quarter ahead of its guidance for the first half of 2025, reducing the risk for another capital raise and dilution.
Manufacturing Expansion
SolarEdge is ramping up U.S. manufacturing to provide solar installers with the domestic content required for tax credits.
Negative Factors
Operating Earnings
The company's operating earnings power has been negatively impacted not only due to current demand and pricing but also its cost structure.
SolarEdge Technologies (SEDG) vs. S&P 500 (SPY)
Market Cap
$941.70M
Dividend YieldN/A
Average Volume (3M)4.69M
Price to Earnings (P/E)―
Beta (1Y)1.75
Revenue Growth-68.86%
EPS Growth-4917.87%
CountryUS
Employees5,633
SectorTechnology
Sector Strength48
IndustryRenewable Energy Producers
Share Statistics
EPS (TTM)-31.20
Shares Outstanding58,782,520
10 Day Avg. Volume3,788,786
30 Day Avg. Volume4,689,641
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.10
Price to Cash Flow (P/CF)20.10
P/FCF Ratio18.30
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$16.31Price Target Upside-3.20% Downside
Rating ConsensusHold
Number of Analyst Covering24
SolarEdge Technologies Business Overview & Revenue Model
Company DescriptionSolarEdge Technologies, Inc. is a leading company in the solar energy sector, specializing in smart energy solutions. The company designs, develops, and sells an intelligent inverter solution that maximizes power generation at the individual solar module level while lowering the cost of energy produced by the solar photovoltaic system. SolarEdge's product offerings include photovoltaic inverters, power optimizers, solar panels, and battery storage solutions, serving residential, commercial, and industrial markets worldwide.
How the Company Makes MoneySolarEdge Technologies makes money primarily through the sale of its solar power optimization products and systems. The company's core revenue stream comes from the sale of its DC optimized inverter systems, which include inverters, power optimizers, and related products. These products are sold to solar installers and distributors who then deploy them in residential, commercial, and industrial solar energy projects. Additionally, SolarEdge generates income from its growing energy storage solutions, which include batteries and energy management software, catering to the increasing demand for integrated solar energy systems. The company also benefits from strategic partnerships and collaborations with other energy and technology companies, which help to expand its market reach and drive sales growth.
SolarEdge Technologies Financial Statement Overview
Summary
SolarEdge Technologies is facing significant financial challenges with negative profitability and cash flow metrics. The company shows moderate leverage, but declining equity and negative cash flow raise sustainability concerns. Cost control and revenue growth opportunities are crucial for financial stabilization.Income Statement
The income statement for SolarEdge Technologies shows a concerning trend, with a significant decrease in revenue from 2023 to 2024 and negative profitability metrics in 2024. Gross Profit Margin and Net Profit Margin were negative, indicating that the company is not only losing money but also struggling with cost control. Historical data shows fluctuating revenue with a notable decline in 2024, impacting gross and net profitability margins.35
Negative
Balance Sheet
The balance sheet reflects moderate financial stability with a Debt-to-Equity Ratio of 1.13 in 2024, suggesting moderate leverage. However, the company's equity has decreased over the years. Return on Equity (ROE) is negative in 2024, indicating inefficiency in using shareholders' equity to generate profit. The Equity Ratio is 0%, reflecting a potential concern in the asset structure.55
Neutral
Cash Flow
SolarEdge Technologies is experiencing negative Free Cash Flow and Operating Cash Flow in 2024, which suggests liquidity challenges. Despite previous years of positive operating cash flow, the recent trend shows a negative Free Cash Flow Growth Rate, highlighting potential issues in sustaining operations without external financing.40
Negative
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 901.46M | 2.98B | 3.11B | 1.96B | 1.46B | Gross Profit |
| -877.20M | 703.82M | 844.65M | 629.32M | 461.36M | EBIT |
| -1.71B | 40.20M | 166.12M | 207.14M | 142.56M | EBITDA |
| -1.64B | 142.49M | 237.63M | 237.44M | 206.06M | Net Income Common Stockholders |
| -1.81B | 34.33M | 93.78M | 169.17M | 140.32M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 585.89M | 860.04M | 1.02B | 697.82M | 1.03B | Total Assets |
| 2.63B | 4.59B | 4.27B | 2.90B | 2.44B | Total Debt |
| 757.35M | 735.30M | 732.27M | 713.68M | 662.61M | Net Debt |
| 482.74M | 396.83M | -50.84M | 183.59M | -164.54M | Total Liabilities |
| 1.97B | 2.18B | 2.09B | 1.59B | 1.35B | Stockholders Equity |
| 658.34M | 2.41B | 2.18B | 1.31B | 1.09B |
| Cash Flow | Free Cash Flow | |||
| -421.48M | -361.24M | -138.06M | 64.88M | 95.86M | Operating Cash Flow |
| -313.32M | -180.11M | 31.28M | 214.13M | 222.66M | Investing Cash Flow |
| 416.29M | -268.89M | -417.04M | -484.21M | -236.64M | Financing Cash Flow |
| -20.13M | -11.96M | 654.61M | -15.18M | 640.48M |
SolarEdge Technologies Technical Analysis
Positive
16.85
Price Trends
15.10
Positive
14.94
Positive
21.95
Negative
Market Momentum
0.38
Positive
54.35
Neutral
41.28
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SEDG, the sentiment is Positive. The current price of 16.85 is above the 20-day moving average (MA) of 16.31, above the 50-day MA of 15.10, and below the 200-day MA of 21.95, indicating a neutral trend. The MACD of 0.38 indicates Positive momentum. The RSI at 54.35 is Neutral, neither overbought nor oversold. The STOCH value of 41.28 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SEDG.
SolarEdge Technologies Risk Analysis
SolarEdge Technologies disclosed 41 risk factors in its most recent earnings report. SolarEdge Technologies reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
SolarEdge Technologies Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $14.90B | 11.58 | 17.62% | ― | 26.75% | 55.24% | |
69 Neutral | $1.16B | 15.61 | 2.78% | 13.06% | -11.91% | -87.40% | |
68 Neutral | $8.16B | 83.49 | 11.30% | ― | -41.92% | -76.24% | |
59 Neutral | $22.39B | 11.53 | -18.05% | 2.31% | 5.00% | -25.89% | |
53 Neutral | $677.63M | 747.45 | 0.03% | ― | -21.68% | -99.75% | |
47 Neutral | $941.70M | ― | -116.01% | ― | -68.86% | -4917.87% | |
46 Neutral | $1.62B | ― | -73.12% | ― | -9.83% | -71.44% |
* Technology Sector Average
Performance Comparison
SEDG
SolarEdge Technologies
16.85
-57.64
-77.38%
CSIQ
Canadian Solar
10.24
-10.35
-50.27%
ENPH
Enphase Energy
61.63
-67.06
-52.11%
FSLR
First Solar
139.13
-23.03
-14.20%
JKS
JinkoSolar
22.66
-4.36
-16.14%
RUN
Sunrun
7.16
-4.86
-40.43%
SolarEdge Technologies Earnings Call Summary
Earnings Call Date: Feb 19, 2025 | % Change Since: -0.47% | Next Earnings Date: May 5, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook. While there were significant strides in free cash flow generation and US manufacturing expansion, the company faced substantial financial losses and market challenges, particularly in Europe. The introduction of new products and innovations offers some optimism for future growth.Highlights
Positive Free Cash Flow
SolarEdge generated approximately $26 million in free cash flow in Q4 2024, ahead of their forecast. They expect to remain free cash flow positive for the entirety of 2025.
US Manufacturing Ramp-Up
SolarEdge is ramping up US manufacturing, creating nearly 2,000 jobs and achieving significant production capacities at their Austin and Florida facilities.
Innovation and Product Development
Introduction of the SolarEdge ONE Controller in Europe and the upcoming Nexus residential portfolio, including a powerful inverter and modular battery, are expected to drive future growth.
Lowlights
Financial Losses and Impairments
SolarEdge reported a non-GAAP net loss of $202.5 million in Q4 2024, with significant inventory write-downs totaling $115 million.
Decline in European Market
Sell-through in Europe was flat, with continued macro headwinds expected to lead to a market decline in 2025.
Revenue Revision and Customer Risks
Revised previously reported revenues by $25.5 million due to an amended agreement with a customer, indicating potential risks with customer agreements.
Company Guidance
During the SolarEdge conference call for Q4 2024 and the outlook for Q1 2025, CEO Shuki Nir outlined the company's key priorities aimed at driving a turnaround and positioning for long-term growth. SolarEdge reported generating approximately $26 million in free cash flow for Q4, surpassing projections, and aims to maintain positive free cash flow throughout 2025. The company plans to strengthen financials through disciplined cash management, inventory reductions, and a shift to US domestic content manufacturing, with expectations to sustain this positive cash flow trajectory. Market share recovery is a focus, particularly through European partnerships aimed at reducing distributor inventory levels. Innovation remains pivotal, with a new residential portfolio set for release by Q4 2025, while US manufacturing ramps up, creating nearly 2,000 jobs and reaching production capacities of 70,000 inverters and 2 million optimizers per quarter. Despite a 17% quarter-over-quarter decline in North American sell-through, SolarEdge is optimistic about the long-term fundamentals of the solar market. The company also marked significant impairment and write-downs, impacting Q4 financials, yet achieved non-GAAP gross margins of 4.8%, excluding these adjustments. Looking forward, SolarEdge projects Q1 2025 revenues between $195 million and $215 million, with non-GAAP gross margins ranging from 6% to 10%.SolarEdge Technologies Corporate Events
Executive/Board Changes
SolarEdge Technologies Appoints New Chief Financial Officer
Neutral
Mar 3, 2025
On March 2, 2025, SolarEdge Technologies appointed Asaf Alperovitz as the new Chief Financial Officer, succeeding Ariel Porat who stepped down for personal reasons. Alperovitz, with extensive experience in finance and leadership roles across various industries, is expected to enhance SolarEdge’s financial strategy and performance, marking a significant transition in the company’s executive team.
Executive/Board ChangesBusiness Operations and Strategy
SolarEdge Expands Board with New Strategic Appointments
Positive
Jan 8, 2025
SolarEdge Technologies has expanded its Board of Directors by appointing Yoram Tietz and Gilad Almogy, aiming to leverage their financial and technological expertise for strategic guidance. This move is expected to strengthen SolarEdge’s board and enhance its strategic objectives in advancing a sustainable energy future.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.