Enphase upgraded to Buy at Credit Suisse on IQ8-driven beat and raise
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Enphase Energy (NASDAQ:ENPH) +5.6% to a new 52-week high in Thursday's trading as Credit Suisse upgrades shares to Outperform from Neutral with a $281 price target, up from $174, citing "strong execution amid supply chain challenges, and as the company has delivered on IQ8 premium pricing/margins."
Analysts Maheep Mandlol and Chandni Chellappa said the magnitude of Enphase's (ENPH) Q2 beat and raise was surprising, even with high expectations; results beat the higher end of guidance and estimates, with strong Q3 guidance, driven by pricing power for IQ8 microinveter products in the U.S. and stronger demand in the U.S. and Europe.
While solar demand and margins were impressive, energy storage shipments fell short of expectations and lead times are still 14-16 weeks due to logistic challenges, but the analysts note that Enphase (ENPH) expects to add a third battery supplier in Q1 2023.
Enphase (ENPH) and other solar names also are enjoying a major boost from the renewed prospect of government funds after Senator Joe Manchin and Majority Leader Chuck Schumer announced a surprise deal that includes $369B for "energy and climate change."