SolarEdge cut at Barclays, seeing 'more bad news before we get good news'
Lari Bat/iStock via Getty Images
SolarEdge Technologies (NASDAQ:SEDG) -5.4% in Monday's trading as Barclays downgraded the stock to Equal Weight from Overweight with a $152 price target, slashed from $274, expecting challenges will persist in 2024 beyond the near-term de-stocking issue.
More bad news is likely to come for the company before any good news, analyst Christine Cho wrote, pointing out potential 2024 headwinds for both SolarEdge (SEDG) and Equal Weight-rated Enphase Energy (ENPH) including price cuts, market share losses, foreign exchange currently trending in an unfavorable direction, a slower than expected rebound in California, and a potential slowdown in Europe.
In the U.S. and especially in California, Cho sees Tesla as a competitor that can impact both inverter and battery deployments while a newer entrant such as privately-held FranklinWH also seems to be gaining traction on the battery side.
NEM 3.0 applications also are indicating smaller installation sizes - which means less MW for inverter shipments for the same number of installations, all else equal - which are down by 25% in Tiers 2 and 3, Cho said.
The analyst believes SolarEdge (SEDG) is tracking for a 20% drop in U.S. shipments in 2023 and expects the declines will continue next year in the low single-digit range, while on the international front, she sees growth in the low single-digits next year with channel inventory corrections to persist through the beginning of 2024 while market share will likely be challenged.

More on SolarEdge Technologies

SolarEdge Technologies: An Even Better Entry Point
SolarEdge Enters Strong Support Territory
SolarEdge Technologies: Inventory Issues Rattle The Stock