Enphase Energy (NASDAQ:ENPH)

I'm bullish on Solar stocks, like SolarEdge and Enphase. Both companies have shown strong revenue growth in recent years, but have been held back by the Covid lockdown. Now backlog demand is waiting to be fulfilled and the companies are ready to pick uo its growth rate from before the lockdown. The Biden administration strongly supports the renewable energy transormation which will also support demand going forward.

Enphase has only one serious competitor (Solaredge) for its most important product (optiimizers). Enphases optimizers are slightly more expensive, but also differ in functionality slightly.

The main difference between the companies is that Solaredge trades at a price-to-sales multiple half of Enphases. This appears to be related to some quality (and potential recall) issues for Solaredge's newest product line. This implies additional risk and may cause Solaredge to underperform in the near term, but once these teething problems are sorted, the upward for Solaredge investors can be higher. Enphase is not cheap at 20 times sales, but strong double digit CAGR for the next ten years is more likely than not, making Enphase a great investment opportunity for the longer term even at current prices.

I just think the World needs more solar, less oil. So here's a competitor to SolarEdge. Hopefully they both do well.