Enphase Energy (ENPH) Falls More Steeply Than Broader Market: What Investors Need to Know

In the latest trading session, Enphase Energy (ENPH) closed at $128.69, marking a -1.22% move from the previous day. The stock's performance was behind the S&P 500's daily loss of 0.11%. Elsewhere, the Dow saw an upswing of 0.12%, while the tech-heavy Nasdaq depreciated by 0.41%.

Heading into today, shares of the solar technology company had gained 6.38% over the past month, outpacing the Oils-Energy sector's gain of 3.56% and the S&P 500's gain of 2.7% in that time.

Market participants will be closely following the financial results of Enphase Energy in its upcoming release. It is anticipated that the company will report an EPS of $0.40, marking a 70.8% fall compared to the same quarter of the previous year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $283.63 million, down 60.93% from the year-ago period.

For the full year, the Zacks Consensus Estimates project earnings of $3.37 per share and a revenue of $1.67 billion, demonstrating changes of -23.58% and -27.14%, respectively, from the preceding year.

Investors should also note any recent changes to analyst estimates for Enphase Energy. These revisions help to show the ever-changing nature of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 2.09% lower within the past month. At present, Enphase Energy boasts a Zacks Rank of #3 (Hold).

Investors should also note Enphase Energy's current valuation metrics, including its Forward P/E ratio of 38.69. This indicates a premium in contrast to its industry's Forward P/E of 11.83.

It is also worth noting that ENPH currently has a PEG ratio of 2.24. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Solar industry currently had an average PEG ratio of 0.72 as of yesterday's close.

The Solar industry is part of the Oils-Energy sector. Currently, this industry holds a Zacks Industry Rank of 152, positioning it in the bottom 40% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow ENPH in the coming trading sessions, be sure to utilize Zacks.com.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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