Enphase Energy plummets 14% as Q3 results, guidance disappoint; analysts downgrade By Investing.com

FREMONT, California – Enphase Energy, Inc. (NASDAQ:) shares plunged more than 14% Wednesday after the solar microinverter maker reported third quarter results that fell short of analyst expectations and provided weaker-than-expected guidance.

The company reported adjusted earnings per share of $0.65, missing the consensus estimate of $0.78. Revenue came in at $380.9 million, below analyst projections of $392.1 million and down 30.9% YoY.

For the fourth quarter, Enphase forecast revenue between $360 million and $400 million, well below the $435.2 million analysts were expecting.

Following the results, Canaccord Genuity analysts downgraded the stock from Buy to Hold and trimmed the target price from $140 to $95.

“Enphase realized continued momentum in the US solar market from Q1/24 lows, but the progress made was overshadowed by an underwhelming top line that missed guidance by ~$10M.”

Separately, Guggenheim analysts downgraded the shares from Neutral to Sell. 

Moreover, analysts at RBC Capital Markets lowered their price target on the stock from $100 to $85 after the outlook fell short.

“We estimate that 4Q24 revenues could be down an additional ~$10mm q/q and are ~$40mm below prior company expectations,” they said. “The challenges are driven by cyclical weakness in the three core markets (Netherlands, France, Germany).”

KeyBanc Capital Markets analysts said ENPH sees Q4 as the bottom and believes lower interest rates, IDC adders, and higher power prices will be “key drivers for 2025 growth.”

The company shipped 1.73 million microinverters, or approximately 730 megawatts DC, and 172.9 megawatt hours of IQ Batteries in Q3. Battery shipments increased from 120.2 megawatt hours in Q2.

Enphase said its U.S. revenue increased about 43% sequentially as inventory returned to normal levels. However, European revenue declined approximately 15% due to softening demand.

“We are now shipping our third generation of IQ Batteries, the IQ Battery 5P, to the United States, Puerto Rico, Mexico, Canada, Australia, the United Kingdom, Italy, France, the Netherlands, Luxembourg, and Belgium,” Kothandaraman noted.

The company generated $161.6 million in free cash flow during the quarter and ended the period with $1.77 billion in cash and marketable securities.

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