SolarEdge Technologies, Inc. (NasdaqGS:SEDG) is scheduled to report Q3 earnings results after markets close for trading on November 2, 2020.
The company is expected to report earnings of $0.85/share on revenue of $342.4 million. The consensus earnings per share (EPS) of $0.85/share is based on a poll of 13 analysts and represents a decline in eps of −29.8% over the same quarter last year, when the company reported earnings of $1.21/share.
The revenue forecast of $342.4 million based on a poll of 14 analysts implies a year-over-year (YoY) decline in revenue of −16.6%. Last year the company reported $410.6 million in revenue for the quarter.
| Metric | Expected | Prior Year | YoY Change |
|---|---|---|---|
| Revenue | $342.36 | $410.56 | −16.6% |
| EPS | $0.85 | $1.21 | −29.8% |
Earnings Call Trends
Historically, management has exceeded analyst expectations 6 out of the last 8 tracked quarters, and missed expectations 2 quarters.
What are your expectations from SolarEdge Technologies, Inc. for earnings this quarter? Let us know in the comments!
| Quarter | Expected | Reported | Surprise | Result |
|---|---|---|---|---|
| Q2, 2020 | $0.71 | $0.97 | 37.4% | Beat |
| Q1, 2020 | $1.27 | $0.95 | −25.4% | Missed |
| Q4, 2019 | $1.25 | $1.65 | 31.5% | Beat |
| Q3, 2019 | $1.13 | $1.21 | 6.9% | Beat |
| Q2, 2019 | $0.83 | $0.94 | 13.5% | Beat |
| Q1, 2019 | $0.57 | $0.64 | 12.8% | Beat |
| Q4, 2018 | $0.69 | $0.63 | −8.8% | Missed |
| Q3, 2018 | $0.82 | $0.86 | 4.7% | Beat |
In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report. After the last earnings report for the period ending June 30, 2020, the stock price reacted by increasing 12.0%.
| Report Date | Price Day Prior | Price Next Day | Change % | Result |
|---|---|---|---|---|
| August 3, 2020 | $175.10 | $196.15 | 12.0% | Increase |
| May 6, 2020 | $107.86 | $109.74 | 1.7% | Increase |
| February 19, 2020 | $108.38 | $142.20 | 31.2% | Increase |
| November 6, 2019 | $83.27 | $79.90 | −4.0% | Decline |
The other question to consider is one of earnings manipulation. There is a lot of pressure on management each quarter to deliver on earnings expectations. The Beneish M-Score is a statistical model that provides some insight into whether the company might be manipulating earnings. With a Beneish M-Score of −3.05, the model suggests that the company is not likely to be an earnings manipulator. A value of −3.05 implies a 0.1% chance of earnings manipulation.
Fundamentals And Technical Analysis
SolarEdge Technologies, Inc. is currently trading at $273/share, down −3.5% for the day. The company is trading at approximately 85.9% of its 52-week high of $317.88/share. The company’s stock price is up 39.2% since the last earnings report and down −11.9% over the previous week.
The company’s 14 Day Relative Price Index (RSI) of 55.21 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.
The current share price implies a price-to-earnings (P/E) multiple of 78.94 and a forward P/E multiple of 67.87.
SolarEdge Technologies, Inc.’s current share price also implies a price-to-book (P/B) multiple of 14.79. The following table summarizes some other key fundamental ratios:
| Metric | Value |
|---|---|
| Last Reported Fiscal Period Key | FY2020.Q2 |
| Period End Date | June 30, 2020 |
| Stock Price (Current) | $273 |
| P/E Ratio | 78.9x |
| P/E Ratio (Fwd) | 67.9x |
| PEG Ratio | 1.7 |
| Total Debt / Total Capital | 0.3% |
| Levered Free Cash Flow | $214.8 million |
| EV / EBITDA | 48.7x |
SolarEdge Technologies, Inc. is a large-cap stock with a market capitalization of $13.682 billion and a total enterprise value of $13.137 billion. The company operates in the Information Technology sector and the Semiconductors & Semiconductor Equipment industry.
SolarEdge Technologies, Inc., together with its subsidiaries, designs, develops, and sells direct current (DC) optimized inverter systems for solar photovoltaic (PV) installations worldwide. Its SolarEdge system consists of inverters, power optimizers, communication devices, smart energy management solutions, and a cloud-based monitoring platform. The company’s products are used in a range of solar market segments, such as residential, commercial, and small utility-scale solar installations. It also provides pre-sales support, ongoing trainings, and technical support and after installation services; and lithium-ion cells, batteries, and energy storage solutions for various industries, including energy storage systems, residential and commercial solar systems, uninterruptible power supplies, electric vehicles, aerospace, marine, and others. The company sells its products to the providers of solar PV systems; and solar installers and distributors, electrical equipment wholesalers, and PV module manufacturers, as well as engineering, procurement, and construction firms. SolarEdge Technologies, Inc. partnership with Schneider Electric to develop the residential solar market and provide homeowners with seamless energy management for smart homes of the future. SolarEdge Technologies, Inc. was founded in 2006 and is headquartered in Herzliya, Israel.
