SolarEdge Technologies (SEDG) AI Stock Analysis

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SolarEdge Technologies

(NASDAQ:SEDG)

Select Model

Neutral 49 (OpenAI - 4o)

Rating:49Neutral

Price Target:

$36.00

▲(18.97% Upside)

The overall stock score is primarily impacted by significant financial challenges, including declining profitability and increased leverage. However, strong revenue growth and strategic initiatives highlighted in the earnings call provide some optimism for future performance. Technical indicators suggest a neutral to slightly positive short-term trend, but valuation concerns due to unprofitability weigh heavily on the score.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust demand for SolarEdge's products, enhancing its market position and supporting long-term business expansion.

Market Share Gains

Regaining market leadership in the U.S. residential sector strengthens SolarEdge's competitive edge and solidifies its presence in a key market.

Strategic Collaboration

The collaboration with Infineon could drive innovation and open new markets, enhancing SolarEdge's technological capabilities and future growth potential.

Negative Factors

Financial Instability

Financial instability, marked by poor profitability and high leverage, poses risks to SolarEdge's long-term financial health and operational flexibility.

Cash Flow Challenges

Persistent cash flow issues could hinder SolarEdge's ability to invest in growth opportunities and manage financial obligations effectively.

Tariff Impact

Tariff impacts on gross margins could pressure profitability, affecting SolarEdge's competitive pricing and margin sustainability over time.

SolarEdge Technologies (SEDG) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$1.83B

Dividend YieldN/A

Average Volume (3M)2.64M

Price to Earnings (P/E)―

Beta (1Y)1.10

Revenue Growth-0.14%

EPS Growth66.71%

CountryUS

Employees3,961

SectorTechnology

Sector Strength88

IndustrySolar

Share Statistics

EPS (TTM)-0.31

Shares Outstanding59,800,053

10 Day Avg. Volume1,810,918

30 Day Avg. Volume2,640,567

Financial Highlights & Ratios

PEG Ratio<0.01

Price to Book (P/B)1.18

Price to Sales (P/S)0.86

P/FCF Ratio-1.84

Enterprise Value/Market Cap1.13

Enterprise Value/Revenue2.02

Enterprise Value/Gross Profit-67.68

Enterprise Value/Ebitda-2.96

Forecast

1Y Price Target

$32.56

Price Target Upside7.60% Upside

Rating ConsensusHold

Number of Analyst Covering18

EPS Forecast (FY)N/A

Revenue Forecast (FY)N/A

SolarEdge Technologies Business Overview & Revenue Model

Company DescriptionSolarEdge Technologies, Inc., together with its subsidiaries, designs, develops, and sells direct current (DC) optimized inverter systems for solar photovoltaic (PV) installations worldwide. It operates through five segments: Solar, Energy Storage, e-Mobility, Critical Power, and Automation Machines. The company offers inverters, power optimizers, communication devices, and smart energy management solutions used in residential, commercial, and small utility-scale solar installations; and a cloud-based monitoring platform that collects and processes information from the power optimizers and inverters, as well as monitors and manages the solar PV system. It also provides residential, commercial, and large scale PV, energy storage and backup, electric vehicle charging, and home energy management solutions, as well as grid services; and e-Mobility, automation machines, lithium-ion cells and battery packs, and uninterrupted power supply solutions, as well as virtual power plants, which helps to manage the load on the grid and grid stability. In addition, the company offers pre-sales support, ongoing trainings, and technical support and after installation services. The company sells its products to the providers of solar PV systems; and solar installers and distributors, electrical equipment wholesalers, and PV module manufacturers, as well as engineering, procurement, and construction firms. SolarEdge Technologies, Inc. was founded in 2006 and is headquartered in Herzliya, Israel.

How the Company Makes MoneySolarEdge generates revenue primarily through the sale of its solar inverters, power optimizers, and energy storage systems, which are essential components of solar energy installations. The company's revenue model relies on direct sales to installers and distributors, as well as partnerships with solar project developers and engineering firms. Additionally, SolarEdge benefits from recurring revenue through its monitoring services, which provide ongoing performance insights for installed solar systems. Significant partnerships with leading solar manufacturers and the expansion into energy storage and electric vehicle (EV) charging solutions also contribute to its earnings, positioning the company to capitalize on the growing demand for renewable energy technologies.

SolarEdge Technologies Key Performance Indicators (KPIs)

Any

Optimizers Shipped

Optimizers Shipped
Measures the quantity of optimizers distributed, showcasing the adoption of technology that enhances solar panel efficiency and the company's innovation in solar energy management.

Chart InsightsSolarEdge Technologies has experienced a significant decline in optimizers shipped since 2023, reflecting operational challenges and market dynamics. Despite recent improvements in gross margins and positive cash flow expectations, the company faces ongoing operating losses and European market weaknesses. The strategic focus on the U.S. market, supported by the One Big Beautiful Bill Act and new partnerships, may help stabilize shipments. However, the sharp drop in shipments highlights potential risks in execution and market demand that investors should monitor closely.

Data provided by:

The Fly

SolarEdge Technologies Earnings Call Summary

Earnings Call Date:Nov 05, 2025

(Q3-2025)

% Change Since: |

Next Earnings Date:Feb 25, 2026

Earnings Call Sentiment Positive

SolarEdge showed strong performance in Q3 2025 with significant revenue growth, market share gains in the U.S., and positive free cash flow. The company is making strides in operational efficiency and expanding its presence in Europe. Challenges include a decline in international markets revenue and tariff impacts. The announcement of a strategic collaboration with Infineon for data centers indicates a promising future opportunity.

Q3-2025 Updates

Positive Updates

Strong Revenue Growth

SolarEdge reported a 44% year-over-year revenue growth and a 21% quarter-over-quarter increase in non-GAAP revenues for Q3 2025, reaching $340 million.

Market Share Gains in the U.S.

SolarEdge regained the #1 residential inverter market share position in the U.S. in Q2 2025, marking a significant improvement since Q3 2021.

Positive Free Cash Flow

The company generated positive free cash flow of approximately $23 million in Q3 and expects to be free cash flow positive in Q4 and for the full year 2025.

Operational Efficiency Initiatives

SolarEdge implemented a single SKU software-defined platform to reduce complexity, improve inventory management, and increase flexibility for customers.

Expansion in Europe

Revenues from Europe reached $101 million, up 45% quarter-over-quarter and 21% year-over-year, with normalized inventory levels among distribution partners.

Data Center Market Opportunity

Announced a collaboration with Infineon to advance a solid-state transformer platform for future data centers, targeting the 800-volt DC architecture expected to start in 2027.

Negative Updates

Decline in International Markets Revenue

International markets revenue decreased by 8% quarter-over-quarter, representing 10% of total revenues.

Challenges in European Market

Despite improvements, the European market remains challenging, impacting overall performance.

Tariff Impact on Gross Margin

Incremental tariffs impacted gross margin by approximately 2%, with similar effects expected in the coming quarters.

Company Guidance

During the SolarEdge Q3 2025 earnings call, the company reported a robust performance with a 44% year-over-year revenue growth and a continued expansion in margins for the fourth consecutive quarter. For Q3, non-GAAP revenues were $340 million, marking a 21% increase quarter-over-quarter, with U.S. revenues up by 10% and European revenues by 55%. The non-GAAP gross margin rose to 18.8% from 13.1% in Q2. SolarEdge ended Q3 with approximately $550 million in cash and investments and achieved positive free cash flow of $23 million, contributing to a reduction in non-GAAP net loss to $18.3 million. The company anticipates Q4 revenues between $310 million and $340 million, with a non-GAAP gross margin of 19% to 23%. SolarEdge highlighted strategic initiatives, such as a single SKU platform to simplify operations and reduce costs, and discussed market share gains in the U.S. residential sector. The company also announced a significant collaboration to advance a solid-state transformer platform for future data centers, emphasizing its ongoing focus on innovation and market expansion.

SolarEdge Technologies Financial Statement Overview

Summary

SolarEdge Technologies is facing significant financial challenges, with declining profitability, increased leverage, and weak cash flow performance. The company needs to address operational inefficiencies and improve its financial stability to enhance shareholder value.

Income Statement

SolarEdge Technologies has experienced significant challenges in profitability, with negative gross and net profit margins in the TTM period. Despite a positive revenue growth rate of 8.43% in the TTM, the company has struggled with negative EBIT and EBITDA margins, indicating operational inefficiencies. Historical data shows a decline in profitability, with margins worsening over recent years.

Balance Sheet

The balance sheet reflects a high debt-to-equity ratio of 1.45 in the TTM, indicating increased leverage and potential financial risk. Return on equity is negative, suggesting that the company is not generating sufficient returns on shareholders' equity. The equity ratio has decreased, pointing to a reduced proportion of equity financing.

Cash Flow

Cash flow analysis reveals a concerning trend with negative free cash flow growth and a low operating cash flow to net income ratio. Although the free cash flow to net income ratio is positive, the overall cash flow position is weak, highlighting liquidity challenges.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.02B	901.46M	2.98B	3.11B	1.96B	1.46B
Gross Profit	-30.48M	-877.20M	703.82M	844.65M	629.32M	461.36M
EBITDA	-697.55M	-1.64B	142.49M	231.28M	230.27M	198.69M
Net Income	-586.23M	-1.81B	34.33M	93.78M	169.17M	140.32M
Balance Sheet
Total Assets	2.23B	2.63B	4.59B	4.27B	2.90B	2.44B
Cash, Cash Equivalents and Short-Term Investments	498.58M	585.89M	860.04M	1.02B	697.82M	1.03B
Total Debt	415.81M	757.35M	732.05M	735.54M	713.83M	662.61M
Total Liabilities	1.75B	1.97B	2.18B	2.09B	1.59B	1.35B
Stockholders Equity	479.76M	658.34M	2.41B	2.18B	1.31B	1.09B
Cash Flow
Free Cash Flow	37.54M	-421.48M	-350.64M	-138.06M	64.88M	95.86M
Operating Cash Flow	63.97M	-313.32M	-180.11M	31.28M	214.13M	222.66M
Investing Cash Flow	469.31M	416.29M	-268.89M	-417.04M	-484.21M	-236.64M
Financing Cash Flow	-349.79M	-20.13M	-11.96M	654.61M	-15.18M	640.48M

SolarEdge Technologies Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price30.26

Price Trends

50DMA

33.31

Negative

100DMA

34.27

Negative

200DMA

27.02

Positive

Market Momentum

MACD

-0.68

Negative

RSI

46.23

Neutral

STOCH

42.06

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SEDG, the sentiment is Neutral. The current price of 30.26 is above the 20-day moving average (MA) of 30.07, below the 50-day MA of 33.31, and above the 200-day MA of 27.02, indicating a neutral trend. The MACD of -0.68 indicates Negative momentum. The RSI at 46.23 is Neutral, neither overbought nor oversold. The STOCH value of 42.06 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SEDG.

SolarEdge Technologies Risk Analysis

SolarEdge Technologies disclosed 3 risk factors in its most recent earnings report. SolarEdge Technologies reported the most risks in the "Legal & Regulatory" 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 (61)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SHLS	67 Neutral	$1.48B	43.39	5.86%	―	2.68%	2.90%
ENPH	64 Neutral	$4.54B	24.52	20.31%	―	20.97%	226.98%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
JKS	61 Neutral	$1.43B	-2.94	-17.96%	10.19%	-34.29%	-732.90%
ARRY	61 Neutral	$1.38B	-14.52	-7.75%	―	35.75%	37.97%
SEDG	49 Neutral	$1.83B	-3.13	-78.09%	―	-0.14%	66.71%
CSIQ	45 Neutral	$1.47B	81.10	0.56%	―	-4.46%	1645.26%

* Technology Sector Average

Performance Comparison

SEDG

SolarEdge Technologies

30.26

15.55

105.71%

CSIQ

Canadian Solar

19.39

7.18

58.80%

ENPH

Enphase Energy

35.43

-31.31

-46.91%

JKS

JinkoSolar

26.83

3.62

15.61%

ARRY

Array Technologies

8.85

2.42

37.64%

SHLS

Shoals Technologies Group

8.60

2.71

46.01%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Nov 14, 2025