Northland raises SolarEdge stock rating, cuts price target

On Tuesday, Northland analyst Gus Richard upgraded SolarEdge Technologies (NASDAQ:SEDG) from Underperform to Market Perform. Accompanying this rating change, the price target was revised downward to $12.50 from the previous $15.00. The adjustment comes after a significant decline in the company’s shares, which have fallen nearly 80% over the past year and are currently trading at $11.72.

Richard’s commentary highlighted that SolarEdge is currently cash flow positive and is actively reducing costs and divesting from unsuccessful acquisitions. While InvestingPro data shows the company is quickly burning through cash, its current ratio of 1.95 indicates liquid assets exceed short-term obligations. He noted that the company is expected to end the calendar year 2025 with approximately $350 million in net cash. The analyst expressed confidence that SolarEdge is unlikely to file for bankruptcy.

The revised price target is based on a 0.6x enterprise value to calendar year 2025 sales ratio (EV/CY25). Despite the upgrade, Richard advised investors not to accumulate shares at the current levels. He suggested that the shares have finished their downward trajectory, indicating a stabilization in the stock’s performance.

SolarEdge Technologies’ financial maneuvers and the resulting analyst rating change reflect the company’s efforts to streamline its operations and strengthen its financial position amidst market challenges. The new rating and price target reflect Northland’s latest assessment of the solar technology firm’s prospects.

In other recent news, SolarEdge Technologies has faced significant developments, including analyst revisions and strategic changes. Morgan Stanley (NYSE:MS) downgraded SolarEdge’s stock from Equalweight to Underweight, lowering the price target to $10, citing concerns over declining demand and potential tariff impacts on earnings. Similarly, Jefferies reduced its price target to $9, maintaining an Underperform rating, pointing to tariff exposure affecting the company’s gross margins. In terms of financial performance, Jefferies projects SolarEdge’s first-quarter revenue at $206 million, aligning with consensus estimates.

Additionally, SolarEdge announced board changes, with the resignation of Marcel Gani and the planned departure of Dirk Hoke, reducing the board size from ten to eight members by 2025. The company also introduced a new solution in collaboration with Enstall and other firms to streamline tax credit processes, aiming to support developers and business owners in compliance and monetization. Furthermore, Truist Securities maintained its Hold rating with an $18 price target following the appointment of Asaf Alperovitz as the new CFO, emphasizing a focus on financial stability and inventory normalization.

These developments indicate SolarEdge’s ongoing efforts to navigate market challenges and strategic shifts. The company is also aiming to regain market positioning in the European Union through competitive pricing. Investors continue to monitor SolarEdge’s progress under its refreshed management team and its strategies to stabilize operations amidst industry uncertainties.

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