In the latest trading session, SolarEdge Technologies (SEDG - Free Report) closed at $148.48, marking a -1.89% move from the previous day. This change was narrower than the S&P 500's daily loss of 2.59%. Elsewhere, the Dow lost 2.72%, while the tech-heavy Nasdaq lost 2.19%.
SEDG will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $0.77, down 18.09% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $321.61 million, down 1.05% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $4.07 per share and revenue of $1.50 billion. These totals would mark changes of -8.33% and +5.52%, respectively, from last year.
Any recent changes to analyst estimates for SEDG should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. SEDG is holding a Zacks Rank of #3 (Hold) right now.
In terms of valuation, SEDG is currently trading at a Forward P/E ratio of 37.23. Its industry sports an average Forward P/E of 27.7, so we one might conclude that SEDG is trading at a premium comparatively.
Also, we should mention that SEDG has a PEG ratio of 1.49. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Solar stocks are, on average, holding a PEG ratio of 1.49 based on yesterday's closing prices.
The Solar industry is part of the Oils-Energy sector. This group has a Zacks Industry Rank of 72, putting it in the top 29% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.