Enphase Energy: Substantial Room For Growth But Still Too Expensive

Davide Zappa
740 Followers

Summary

  • Enphase Energy will benefit from the expansion of the solar energy industry, becoming a global supplier of solar energy solutions.
  • The market prices Enphase Energy as a growth play and the modest guidance given for the Q2 wasn't well received by the market with Enphase stocks plunging more than 25%.
  • Even if I assumed strong growth rates for the company in my valuation, Enphase Energy still results to be overvalued by more than 48% at today’s prices.

House with solar panels

Eoneren

Investment Thesis

With a drawback of more than 25%, which wiped out $9 billion of Enphase Energy's (NASDAQ:ENPH) market capitalization, the market didn’t seem very pleased with the modest growth expectation given by Enphase’s management for the second

This article was written by

740 Followers
Davide Zappa uses a fundamental approach based on industry-level data to value growth stocks. Davide is also the founder of BlackNote Investment, an equity research platform providing free access to industry-level data such as industry growth rates, equity risk premiums, country growth rates, industry beta, as well as detailed industry reports, to support retail investors and professional analysts in their daily activities.

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. 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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