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Investing.com - Oppenheimer maintained its Perform rating on SolarEdge Technologies (NASDAQ:SEDG) as the solar energy company shows signs of recovery in its business operations. According to InvestingPro data, the stock has shown remarkable resilience with an 80% surge over the past six months, despite current analyst consensus remaining cautious with a Hold recommendation.
The research firm noted that SolarEdge has made "meaningful progress" on its recovery, highlighting that channel inventory levels have largely normalized and the company is guiding toward gross margin recovery in the third quarter of 2025. This recovery is crucial, as InvestingPro analysis shows the company currently operates with weak gross profit margins and hasn’t been profitable over the last twelve months.
Oppenheimer expressed encouragement about SolarEdge’s evolving product offerings, aggressive push on energy storage sales, and completion of its U.S. manufacturing footprint, which could potentially support future growth.
The firm identified potential for incremental margin improvement as the company scales revenue, particularly in the United States, and acknowledged that SolarEdge’s balance sheet appears sufficient to support its return to profitability.
Despite these positive developments, Oppenheimer remains "on the sidelines," noting that current gross margins would require more than 30% quarterly run-rate growth to reach breakeven based on the midpoint of third-quarter 2025 guidance, and awaits "further evidence of sustained revenue growth and margin expansion."
In other recent news, SolarEdge Technologies reported a second-quarter revenue of $289.41 million, surpassing analyst expectations of $273.63 million. This represents a 32% increase from the previous quarter, contributing to a positive market reaction. The company also posted an adjusted loss of $0.81 per share, which was better than the anticipated loss of $0.85 per share. Despite these strong results, GLJ Research maintained a Hold rating on SolarEdge, citing that the revenue beat was likely driven by temporary factors rather than organic demand growth. The firm also noted a decline in SolarEdge’s Deferred Revenue and Customer Deposits by $39.3 million, aligning closely with the revenue beat amount. Barclays (LON:BARC), meanwhile, reiterated its Equalweight rating with a $29.00 price target, emphasizing SolarEdge’s strategic position in the U.S. commercial and industrial solar sector. Barclays pointed out the company’s potential to gain market share due to domestic content requirements and foreign entity of concern restrictions. These developments highlight the mixed analyst perspectives on SolarEdge’s future growth prospects.
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