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Investing.com - JPMorgan downgraded SolarEdge Technologies (NASDAQ:SEDG) from Overweight to Neutral on Tuesday, while simultaneously raising its price target to $23.00 from $18.00. According to InvestingPro data, the stock has shown remarkable momentum with a 96.47% gain year-to-date, though the company’s overall financial health score remains weak at 1.43.
The downgrade comes despite JPMorgan’s positive outlook on SolarEdge’s potential to regain market share due to its higher exposure to the lease/PPA market. The firm also noted that SolarEdge’s 45x manufacturing credits remain unchanged from the Inflation Reduction Act, and tax credit transferability rules continue to support the company’s quarterly transfers.
JPMorgan cited SolarEdge’s significant stock outperformance since May 1 as the primary reason for the downgrade, with shares up 109% compared to the coverage average of 33%.
The investment bank expressed encouragement about initial progress from SolarEdge’s new management team, which is focusing on efficiency and SKU rationalization, though noted it is still early in this process.
JPMorgan’s year-end 2025 price target increase reflects higher fiscal year 2026 estimates and an increased assigned P/E multiple of 22x, up from 19x, representing a slight premium to the multiple assigned to competitor Enphase Energy (NASDAQ:ENPH) due to stronger revenue visibility.
In other recent news, SolarEdge Technologies has been the focus of several significant developments. UBS raised its price target for SolarEdge to $20 from $17, maintaining a Neutral rating, due to potential impacts from the elimination of U.S. residential tax credits. Jefferies also increased its price target to $18 from $10, though it maintained an Underperform rating, citing ongoing headwinds despite recent stock performance. Meanwhile, KeyBanc upgraded SolarEdge to Sector Weight, highlighting vulnerabilities related to the expiration of residential solar tax credits by 2025.
Bank of America analysts have adjusted their forecasts for SolarEdge, reducing projected U.S. volumes to 1.9 gigawatts for 2026 due to policy risks and stalled demand. Additionally, at SolarEdge’s recent annual shareholder meeting, six directors were elected, and the company ratified its independent auditors for the fiscal year ending December 31, 2025. However, a proposal to amend the company’s Restated Certificate of Incorporation did not pass. These developments reflect a complex landscape of policy changes and market dynamics that SolarEdge faces in the coming years.
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