SolarEdge Technologies (SEDG) stock surged Tuesday after the clean energy stock received a bullish rating upgrade along with a price target increase while fellow solar stocks saw price target cuts.
Goldman Sachs analysts late Monday double upgraded SolarEdge stock to a buy rating from a sell, and upped the price target to 19 up from 10. The analysts wrote that investor fears around SolarEdge being able to address $350 million of debt in 2025 appear “overblown.” Goldman sees this as “creating a relatively attractive risk/reward” for SEDG.
The firm also highlighted the company’s restructuring efforts, putting SolarEdge in a position to better leverage its cost structure and improve product sales mix. In November, SolarEdge closed its energy storage division as it looks to liquidate noncore assets, cut operational expenses and return to profit.
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SolarEdge stock surged 16.64% to 14.37 in market action on Tuesday. The stock tumbled 7.7% to 12.32 on Monday. SEDG stock has plunged 86.8% so far in 2024, peaking at 389.71 in November 2021. Shares are below their 50-day line and far below a long-sliding 200-day.
Clean Energy Stocks And Trump
While Goldman Sachs is bullish on SolarEdge, seeing 54% upside with its price target, the firm lowered price targets on fellow clean energy stocks Sunrun (RUN) and Enphase (ENPH).
The Goldman Sachs analysts late Monday cut its ENPH stock price target to 121 from 145. The firm maintained a buy rating even as it cut its 2024 EPS estimate for Enphase by 4% on the back of incremental impairment charges in the quarter. The analysts also reduced their Sunrun price target by $2 to 17 amid expectations there will be some shakeout in the residential solar installer space, with weaker operations falling by the wayside.
Goldman Sachs outlook on solar stocks comes as analysts are bracing for uncertainty for clean energy and renewable stocks in 2025. President-elect Donald Trump has signaled that he wants to repeal large portions of the Inflation Reduction Act (IRA), which included a variety of green energy credits. He’s already shown he is not afraid to impose tariffs on China and other countries, which could hit solar panel components.
At the end of November, Morgan Stanley reduced its clean technology industry view to “in-line” down from “attractive” amid the uncertainty surrounding the upcoming Trump administration.
Please follow Kit Norton on X @KitNorton for more coverage.
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