From climate denier to climate change activist, the U.S. is making a 90-degree turnaround this week. With Joe Biden taking office on January 20, the country is moving into a new future, a green future. On his very first day in the White House, the newly elected US president wants to rejoin the Paris climate agreement, which was cancelled by his predecessor Donald Trump and is considered a milestone in the fight against global warming. But that's not all: Biden also has a billion-dollar plan for sustainable infrastructure and industry in his pocket.
The move away from fossil fuels, coupled with a greater expansion of renewable energies, has recently brought high price gains for stocks in the sector. SolarEdge is one of them. The share price rose by almost 170% in the past 12 months. However, there has recently been some profit-taking. From its record high of USD 377, the stock dipped by around USD 100, or just over a quarter. After the preceding rally, the consolidation can certainly be seen as a healthy breather. However, it does not change anything about the positive long-term conditions. The future plans of governments around the globe are all green. Even China, which has been hesitant for a long time, has now announced its intention to be climate-neutral by 2060 at the latest.
So as a specialist in renewable energies, SolarEdge should have a rosy future ahead of it. The company is known for its smart inverters as well as its innovative solar power monitoring solutions for homes and commercial facilities. Founded in Israel in 2006, the company has sold 21 gigawatts (GW) of power worldwide and 1.75 million energy management platforms. According to IHS, SolarEdge is even ahead of Germany's SMA in first place in the global inverter market. The further growth prospects for the company are enormous. According to McKinsey forecasts, solar energy is expected to grow by a factor of 60 from 2015 to 2050.
A look at SolarEdge's books shows that the company is well positioned in the industry. Between 2015 and 2019, revenue grew at an average annual rate of 35.4%, and net income nearly tripled over that period. To be sure, the steep revenue and profit curve gets a damper in Corona's 2020 year. The analyst consensus only expects revenue and earnings expansion rates of around 8%. But already this year, business is expected to pick up again and values are expected to rise again in the double-digit percentage range.
On February 17, SolarEdge will report on the past year. After 9 months, revenue and profit showed small growth despite the global lockdowns in the wake of Covid-19. "Our solar business outside the U.S. has reached an all-time high and the U.S. market is showing signs of returning to pre-pandemic installation levels," CEO Zivi Lando explained during the financial presentation. In addition, the company has also been making progress beyond its solar business of late. For the fourth quarter, Lando announced that the e-mobility division is shipping its first significant batch of full-drive solutions for installation in electric vehicles. In the promising e-mobility space, SolarEdge has even more products, such as a single-phase inverter with an integrated e-charge controller that allows a "Stromer" to charge up to 2.5 times faster than with a conventional charger.
The average of 19 analyst reports currently gives SolarEdge stock a "hold" rating. The median price target is USD 296.50, which represents a moderate premium of 5% over the current quotation. With the new Softcallable Barrier Reverse Convertibles, there is considerably more to be had, even with conditional partial protection. With a barrier distance of 41%, the CHF version of the product offers the prospect of a return of 15.60% p.a.. The USD version even offers a coupon of 17.00% p.a. with the same risk buffer. In order for the products to generate the maximum return in one year at the latest, no price increases are required; the only thing that must remain intact is the barrier. The term can be shortened to 6 months due to the soft callable function.
We look forward to answering all of your questions about our products and how they are traded. Please don't hesitate to get in touch! Phone: 058 800 11 11, email info@leonteq.com or contact us here.