SolarEdge stock price target raised to $6.90 by GLJ Research

On Wednesday, GLJ Research analyst Gordon Johnson increased the price target on SolarEdge Technologies (NASDAQ:SEDG) to $6.90, up from $3.90, while reaffirming a Sell rating on the company’s shares. Currently trading at $19.63, the stock has shown significant volatility, gaining over 92% in the past six months despite falling 57% year-over-year. According to InvestingPro data, 13 analysts have recently revised their earnings estimates upward for the upcoming period. Johnson’s revised price target comes amid observations of SolarEdge’s revenue recognition practices and market conditions affecting the solar industry.

According to Johnson, SolarEdge has been advancing its revenues by recognizing safe harbor sales. This practice refers to customers purchasing SolarEdge inverters in advance to secure tax credits for solar installations that are planned for more than a year later. Johnson pointed out that unlike its competitor Enphase Energy (NASDAQ:ENPH), SolarEdge does not disclose the amount of revenue coming from safe harbor sales, making it difficult for analysts to adjust their financial models accordingly. InvestingPro analysis reveals concerning metrics, including a -87% gross profit margin and a significant revenue decline of -59% in the last twelve months.

Additionally, the analyst noted that SolarEdge is drawing on one-time deferred revenue, which stems from higher-margin products sold to Net Energy Metering (NEM) 1.0 and 2.0 customers in the past. This strategy is portrayed as a temporary boost to the company’s profitability.

Despite the increase in the target price, Johnson remains concerned about SolarEdge’s long-term prospects. He cited the rising U.S. Treasury yields as a particular challenge for solar companies like SolarEdge. Higher yields tend to increase the cost of financing solar systems, potentially dampening demand for solar installations.

The analyst’s comments reflect skepticism about SolarEdge’s current financial strategies and the broader market dynamics that could impact the company’s performance. His assessment suggests that while the stock has seen a recent surge in price, underlying issues persist that may affect SolarEdge’s future growth.

In other recent news, SolarEdge Technologies has introduced a solar-powered electric vehicle (EV) charging system for businesses at Intersolar Europe 2025. The system is designed to optimize energy costs by utilizing solar power for EV fleet charging, with reported savings of about 70% for one initial beta customer. This new product is part of SolarEdge’s broader strategy to integrate its commercial solar and storage solutions with EV charging, aiming to create a comprehensive energy ecosystem. In financial developments, SolarEdge’s first-quarter earnings of 2025 showed an adjusted EBITDA slightly above market consensus, prompting UBS to adjust the stock’s price target to $17.00 from $22.00 while maintaining a Neutral rating.

Canaccord Genuity has also raised its price target for SolarEdge to $16.50 from $14.00, reflecting revised expectations due to potential tariff renegotiations and market share dynamics. Meanwhile, Northland downgraded SolarEdge from Outperform to Market Perform, citing valuation concerns amid a challenging macroeconomic environment. Citi, however, maintained its Buy rating with a $39.00 price target, indicating continued confidence in the company’s trajectory. These updates from various analysts provide a mixed perspective on SolarEdge’s financial outlook, influenced by factors such as tariffs and market positioning.

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