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Enphase Energy: The Inflection Point

TJ Roberts profile picture
TJ Roberts


  • Enphase Adds $18M Savings in 2017, Targets $15M/Qtr OpEx Run-rate
  • Enphase R&D Expenses Completed for 2018-19 Product Introductions
  • Jinko Solar, LG, SolarWorld-USA, Tindo Solar — Who’s Next?
  • Enphase Director’s Proxy Victory is a Win for Enphase

At Enphase Energy’s (NASDAQ:ENPH) last Analyst Day, the event summed up a very positive future for the company. At the very beginning of the presentation, Enphase boldly stated that their reduction in module-level costs by 50%, equating to $0.10/Watt costs, is now just 3 quarters away. The new COO confidently reported Enphase’s cost-of-revenue reduction efforts totaling $18M for the remainder of 2017, with a target goal of $15M-per-quarter OpEx run-rate. For all Enphase loyalists out there, this is positive news; the mismanagement of Enphase’s past is now behind them, and having legendary CEO TJ Rodgers in the active director seat, along with COO Badri Kothandaraman, gives Enphase new blood, new life and a very exciting future. Remember, CFO Bert Garcia stated that all of Enphase’s R&D is paid for over the company’s next growth cycle — 2018-19, so going forward, this cost is not going to be a thorn in Enphase’s side. All-in-all, the complete waterfall of margin contributions was devised to achieve a “30-20-10” goal — 30% margin, 20% OpEx, and 10% operating income; hence, it can be deduced that Enphase plans to be profitable at a $75M revenue run-rate

Enphase’s new IQ microinverters are the company’s sixth major generation of product; this latest generation’s technology is much different from previous microinverter releases, and took 5 years to develop. According to a very prominent, Enphase veteran engineer, the IQ technology is now truly scalable in terms of power handling. This attribute of flexibility will allow Enphase to compete on a much wider spectrum. With IQ, Enphase can now scale power handling quite seamlessly, in part by digital and further by selecting the right-sized power transistor, rather than completely overhauling the architecture, digital controls, etc; this should allow cost-effective scaling to pair with today’s complete line-up of solar panels from 250-Watts up through newer generations 440-Watts and beyond. Basically, for

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TJ Roberts profile picture
I've written research articles on Enphase Energy (ENPH), Alpha & Omega Semiconductor (AOSL), Amprius (AMPX), Enovix (ENVX), Equitrans Midstream (ETRN), FTC Solar (FTCI), Katapult (KPLT), and Profound Medical (PROF).  Enphase has been by far my most successful endeavor, and their energy systems are the best in terms of reliability, safety, performance and longevity.  My articles on Amprius and Enovix spotlight an incredibly bright future for these battery companies that could offer a huge return for investors.  My article on Lease-to-Own company, Katapult (KPLT), discusses a beat-down company that is starting to show signs of life with 2023 being their pivotal year.  My article on Equitrans Midstream (ETRN) discusses the highly political Mountain Valley Pipeline.  Please enjoy my articles, and as always, do your own due diligence.  Good luck!

Analyst’s Disclosure: I am/we are long ENPH. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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