Enphase Energy Plunges 12.67% on Downgrade, Bullish Thesis Emerges

On May 22, 2025, Enphase Energy's stock experienced a significant drop of 12.67% in pre-market trading, sparking concerns among investors about the company's recent performance and future prospects.

BNP Paribas Exane downgraded Enphase Energy from a "neutral" rating to an "underperform" rating, setting a target price of $40.00. This move reflects growing pessimism about the company's short-term outlook, potentially contributing to the recent decline in stock price.

Despite the negative sentiment, a bullish thesis on Enphase Energy was presented on Substack by OppCost. The article highlighted the company's strong revenue growth, operating leverage, and robust balance sheet, suggesting that the stock is significantly undervalued with a potential 54% upside.

In a recent stockholder meeting, Enphase Energy's shareholders approved an amendment to the 2021 Equity Incentive Plan, increasing the number of shares reserved for issuance by 4,000,000. This decision aims to provide more flexibility for the company to attract and retain talent, which could be crucial for its long-term growth.

Tidal Investments LLC reduced its holdings in Enphase Energy, which may indicate a shift in investor sentiment towards the company. However, the overall market conditions, including the recent sell-off in the US bond market, have also played a role in the stock's performance.