On Wednesday, BMO Capital Markets adjusted its outlook on Enphase Energy (NASDAQ:ENPH), a prominent player in the solar energy sector. The firm reduced its price target on the company's shares to $113 from $118, while retaining a Market Perform rating. The revision follows Enphase's first-quarter results, which the company indicated would represent the lowest point, with expectations to clear its product channel by the end of the second quarter of 2024.
Enphase Energy's second-quarter revenue guidance ranged between $290 million and $330 million, with a midpoint of $310 million. This projection fell short of the market consensus, which was set at $350 million, and BMO Capital's own estimate of $360 million. The guidance suggested that battery revenues would constitute a significant portion, indicating that inverter demand might not meet prior expectations.
Following Enphase Energy's earnings call, BMO Capital expressed reduced confidence in the company's ability to meet the higher end of its previously stated normalized demand range of $450 to $500 million. As a result of the latest guidance and the call's insights, BMO Capital has revised its estimates for the second through fourth quarters of the year downward.
The price target adjustment reflects the analyst's concerns about the company's near-term revenue and demand trajectory. Despite the reduced price target, BMO Capital maintains its Market Perform rating on Enphase Energy, suggesting a neutral stance on the stock's potential performance.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.