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Enphase's (ENPH) IQ Microinverter Demand Rises in Australia

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Enphase Energy, Inc. (ENPH - Free Report) has been witnessing the intensifying installation of its IQ microinverters in Australia’s solar market, buoyed by the nation’s solar safety regulations, which have been upgraded lately. This, in turn, should boost the demand for other Enphase products, connected with IQ microinverters, like Enphase Installer Network and Enphase IQ Gateway.

What’s Driving Demand?

In Australia, revised regulations, AS/NZS5033:2021, came into effect in May 2022 to encourage consumer and electrical contractor safety. The revised regulations entail new mandatory compliance needs and norms for solar installers to be attained for safety measures.

These norms further require the compliance measures accomplishment for direct current (“DC”) central (“string”) inverter-based solar systems, including restrictive cable runs, the IEC 62930 compliant DC cable and high-visibility DC voltage and warning signs.

However, most of the new regulations do not apply on alternative current (“AC”) decentralized inverter-based solar systems, which encourage operations at extra-low voltage. This fuelled the demand for the Enphase microinverter in the region, which provides AC reliability and safety, thus eliminating the risk related to high-voltage DC solar systems.

Moreover, Enphase microinverters offer unique software-defined architecture and semiconductor integration and have been built with excellent resiliency to operate under all kinds of climatic conditions.

Such remarkable features of IQ microinverters must have boosted their installation in Australia’s market.

GlobalSolar Market Boom

As nations increase the adaptability of renewable sources of energy to mitigate the effect of climate crisis, the solar market landscape is likely to witness buoyancy in demand going ahead. Per the report from Mordor Intelligence, the global solar energy market is poised to witness a CAGR of more than 13.8% during the 2022-2027 period, which bodes well for the solar market considering the global pent-up demand.

Hence, such market expansion prospects bring significant growth opportunities for major industry participants to enjoy the perks of the lucrative solar market.In this context, ENPH, JinkoSolar (JKS - Free Report) , SolarEdge (SEDG - Free Report) and SunPower (SPWR - Free Report) are some of the major solar companies that are poised to shine in the expanding global solar market.

JinKoSolar is a leading provider of module shipments globally. As of Mar 31, 2022, the cumulative module shipments of Jinko Solar exceeded 100 gigawatts (GW) and the company's effective production capacity of monocrystalline silicon wafers, cells and modules reached 40 GW, 40 GW and 50 GW, respectively.

The Zacks Consensus Estimate for JinkoSolar’s 2022 earnings suggests a growth rate of 64.1% from the prior-year reported figure. Shares of JKS have rallied 71.6% in the past year.

SolarEdge is a leading provider of an optimized inverter solution. As of Mar 31, 2022, SolarEdge shipped approximately 89.6 million power optimizers, 3.7 million inverters and 16.3 thousand residential batteries. Also, more than 2.6 million installations are currently connected to and monitored through a cloud-based monitoring platform.

SolarEdge boasts a long-term earnings growth rate of 28.5%. SEDG shares have rallied 28.6% in the past year.

SunPower is a leading solar technology and energy services provider that offers fully integrated solar, storage and home energy solutions. The company added 16,500 customers in the first quarter of 2022, reflecting growth of 40% year over year, while bringing its total customer base to 443,800.

The Zacks Consensus Estimate for SunPower’s 2022 sales suggests a growth rate of 20.8% from the prior-year reported figure. SPWR shares have rallied 23.2% in the past month.

Price Movement

In the past year, shares of Enphase Energy have rallied 50.4% against the industry’s decline of 7.9%.

Zacks Investment Research
Image Source: Zacks Investment Research

Zacks Rank

Enphase Energy currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.