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Analyzing one of the best U.S. stock companies for performance over the last 5 years - $ENPH
I saw this on another forum a few days ago, wonder if this will continue to go up? The content below was the shared content.

In the past 5 years: $ENPH rose nearly 235 times or 23,566%

Like Tesla $TSLA, this company is also engaged in new energy-related industries - Enphase Energy ($ENPH), a company mainly engaged in the solar field, rose about 23,566% from June 15, 2017 to June 15, 2022, an increase of nearly 235 times!

Enphase is developing rapidly, and its stock price has risen by more than 450% and 570% in 2019 and 2020, respectively Enphase Energy ($ENPH) is a global energy technology company that designs, manufactures and sells home energy products, as well as an intelligent platform for solar panels, best known for their market-leading Microinverters system.

Affected by the global trend of green energy and the increasing popularity of micro-inverter systems, Enphase has grown at an astonishing rate in the past few years. From the perspective of stock price, the company has soared by more than 450% in 2019 and continues to soar nearly 600% in 2020. . Although the company's stock price is currently down more than 8% this year, this does not hide its previous "glow".

Enphase currently has the following highlights:

Enphase's revenue and profit growth is accelerating, and its excellent Q1 performance shows that the company has the ability to deal with supply chain challenges.

It has a strong economic moat and advanced and superior technology, and will strengthen the economic moat through continuous R&D and acquisitions.

Companies will benefit from substantial growth in the microinverter market over the next few years, with room to grow outside the US.

Q1 revenue increased by 46% year-on-year, with rapid growth and stable profit margins

In late April, Enphase announced its 2022 Q1 results, and the company excelled in many ways. It recorded revenue of $441 million in the quarter, up 46% year over year. Meanwhile, Enphase generated free cash flow of $90.1 million.

The most impressive thing is that while it continues to grow rapidly, it has maintained a stable profit margin - Q1 gross profit margin and operating profit margin are basically the same as last year. Considering the ongoing difficulties of the global supply chain, this demonstrates the company's good supply chain management capabilities.

These outstanding performances are not unrelated to the management's clever allocation of capital and strategic layout of production bases. Currently, the company's manufacturing bases are mostly distributed in three countries (Mexico, India and China), and it is expanding the capacity of its Romanian plant to meet the growing demands of the European market.


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Enphase micro-inverter is the dominant one, accounting for more than 70% of the share

Enphase has a strong moat -- its technological edge. Enphase is known for its micro-inverter technology. A report from Everbright Securities in May this year showed that Enphase is currently the dominant player in the field of micro-inverters, accounting for more than 70% of the market share.

Micro-inverters have natural advantages over traditional string inverters. Traditional inverters convert DC power from multiple panels ("string" panels) to AC power. Whereas in a micro-inverter system, each panel has a micro-inverter that independently generates AC power. This structural difference enables microinverters to overcome the challenges of shading, pollution and panel failure. Basically, if a microinverter fails, it only affects one panel, not the entire system.

Building on these natural advantages, Enphase's microinverters are more efficient and economical due to their advanced grid-connection capabilities, predictive control systems and integrated energy management technology. An integrated energy management system can optimize the generation, storage and distribution of energy.

In addition, Enphase has been continuously investing in research and development ($119 million in the last 12 months) to enhance its technological edge. At the same time, it will also further enhance their technical capabilities through acquisitions (such as the acquisition of Sofdesk in 2021).

Macro positive: increasing popularity of solar energy, market demand for micro-inverters may increase by 20% annually

There are several macro factors that will benefit Enphase in the long run.

The first is the growing popularity of solar energy. U.S. solar capacity has been growing rapidly thanks to favorable policies, rapidly falling costs, and growing interest in green energy. As of March 2022, the entire United States has 121 gigawatts of solar power generation capacity.

Another factor is the growing popularity of microinverters. As mentioned above, micro-inverters have many advantages over traditional inverters, so the demand for micro-inverters is increasing. According to Mordor Intelligence, demand for microinverters is expected to grow at an annual rate of 20% through 2025. In addition, Enphase's strategic collaborations with U.S. Solar Power (SunPower) (SPWR), Panasonic, Ryuji, Solaria and Hanwha will contribute to Enphase's growth.


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