In addition to reporting quarterly results, the company said it has signed an agreement with Samsung for cells to help ramp its energy storage product
Shares of SolarEdge (SEDG) are on the rise on Tuesday morning after the company reported better than expected second quarter results and provided a stronger revenue forecast for the third quarter. Following the news, Citi analyst J.N. Lowe upgraded the stock to Buy on a faster than expected storage ramp, while his peer at Johnson Rice upgraded the shares to Accumulate.
QUARTERLY RESULTS: SolarEdge reported second quarter earnings of $1.28 and revenue of $480.1M, both better than the expected $1.12 and $454.69M, respectively. Additionally, the company reported 1.64 Gigawatts of inverters shipped. For the third quarter, SolarEdge sees revenue between $520M-$540M, with consensus at $504.68M, and non-GAAP gross margin within the range of 32% to 34%.
During its earnings conference call, the company also said that, “We are gradually ramping production of the battery and plan to ship between 25 megawatt hour to 30 megawatt hour of batteries in the third quarter. In order to meet the strong demand, we have signed an agreement with Samsung SDI for the supply of 1 gigawatt hour of cells to be provided in 2022. We are excited about this cooperation with the leading high quality cell manufacturer.”
STORAGE RAMP: Citi analyst J.B. Lowe upgraded SolarEdge to Buy from Neutral with a price target of $360, up from $300, after the company announced its foray into the residential storage space “with a bang” after several quarters of delays. The supply agreement with Samsung SDI and anticipated capacity ramp to 250 MWh by mid-2022 exceeded his expectations and sets the stage for SolarEdge to become “a major player in the competitive residential solar space” much more quickly than he expected, the analyst told investors.
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