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SolarEdge Technologies ((SEDG - Free Report) ), the $4.7 billion maker of solar equipment like inverters that transform direct current from solar panels into alternating current, fell into the cellar of the Zacks Rank last Tuesday as EPS estimates were knocked down further by Wall Street analysts.
Then on Friday, SEDG shares suffered their worst drop in history after the company announced mounting order cancellations from Europe.
SolarEdge plummeted 27% following the company’s preliminary Q3 results, which were released on Thursday after the market close.
“During the second part of the third quarter of 2023, we experienced substantial unexpected cancellations and pushouts of existing backlog from our European distributors,” SolarEdge CEO Zvi Lando said.
SolarEdge now expects to post September quarter revenue of $720 to $730 million, down almost 20% from earlier forecasts of $880 to $920 million.
The move in the Zacks Rank that gave investors warning was this: in the past 60 days, full-year EPS estimates were revised downward from $9.84 to $9.35. And almost 90 days ago, the analyst consensus was up at $10.97.
As of Monday 10/23, the new consensus is at $9.01 -- down almost 27% in three months! But not all analysts figures have been updated in their models reporting to the Zacks Research System (ZRS), our institutional database.
So it's possible that number falls even further. And 2024 EPS estimates are a big unknown now too, as they have fallen 20% in the past 90 days.
The main take away here is that this kind of sales uncertainty for the company will create much wider uncertainty for analysts who have to estimate future growth.
One example of the drastic reactions you'll be seeing is an investment bank like BMO Capital slashing their price target on SEDG shares to $111 From $216.
Forecasts may take several months and another full reporting quarter (after December) to stabilize. The Zacks Rank will once again let you know.
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Bear of the Day: SolarEdge (SEDG)
SolarEdge Technologies ((SEDG - Free Report) ), the $4.7 billion maker of solar equipment like inverters that transform direct current from solar panels into alternating current, fell into the cellar of the Zacks Rank last Tuesday as EPS estimates were knocked down further by Wall Street analysts.
Then on Friday, SEDG shares suffered their worst drop in history after the company announced mounting order cancellations from Europe.
SolarEdge plummeted 27% following the company’s preliminary Q3 results, which were released on Thursday after the market close.
“During the second part of the third quarter of 2023, we experienced substantial unexpected cancellations and pushouts of existing backlog from our European distributors,” SolarEdge CEO Zvi Lando said.
SolarEdge now expects to post September quarter revenue of $720 to $730 million, down almost 20% from earlier forecasts of $880 to $920 million.
The move in the Zacks Rank that gave investors warning was this: in the past 60 days, full-year EPS estimates were revised downward from $9.84 to $9.35. And almost 90 days ago, the analyst consensus was up at $10.97.
As of Monday 10/23, the new consensus is at $9.01 -- down almost 27% in three months! But not all analysts figures have been updated in their models reporting to the Zacks Research System (ZRS), our institutional database.
So it's possible that number falls even further. And 2024 EPS estimates are a big unknown now too, as they have fallen 20% in the past 90 days.
The main take away here is that this kind of sales uncertainty for the company will create much wider uncertainty for analysts who have to estimate future growth.
One example of the drastic reactions you'll be seeing is an investment bank like BMO Capital slashing their price target on SEDG shares to $111 From $216.
Forecasts may take several months and another full reporting quarter (after December) to stabilize. The Zacks Rank will once again let you know.