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Enphase Energy (ENPH) Stock Falls Amid Market Uptick: What Investors Need to Know

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Enphase Energy (ENPH - Free Report) closed the most recent trading day at $116.69, moving -0.26% from the previous trading session. The stock fell short of the S&P 500, which registered a gain of 0.25% for the day. Meanwhile, the Dow gained 0.2%, and the Nasdaq, a tech-heavy index, added 0.56%.

The solar technology company's shares have seen a decrease of 4.56% over the last month, not keeping up with the Oils-Energy sector's loss of 0.05% and the S&P 500's gain of 1.65%.

The investment community will be paying close attention to the earnings performance of Enphase Energy in its upcoming release. The company is expected to report EPS of $0.77, down 24.51% from the prior-year quarter. At the same time, our most recent consensus estimate is projecting a revenue of $394.17 million, reflecting a 28.47% fall from the equivalent quarter last year.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $2.54 per share and a revenue of $1.41 billion, representing changes of -42.4% and -38.63%, respectively, from the prior year.

Any recent changes to analyst estimates for Enphase Energy should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 3.57% lower. Enphase Energy is holding a Zacks Rank of #3 (Hold) right now.

Investors should also note Enphase Energy's current valuation metrics, including its Forward P/E ratio of 46.13. For comparison, its industry has an average Forward P/E of 17.19, which means Enphase Energy is trading at a premium to the group.

It's also important to note that ENPH currently trades at a PEG ratio of 2.91. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Solar industry currently had an average PEG ratio of 1.94 as of yesterday's close.

The Solar industry is part of the Oils-Energy sector. This industry, currently bearing a Zacks Industry Rank of 177, finds itself in the bottom 31% echelons of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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