Stock Analysis | Solaredge Outlook - A Mixed Technical Picture and Weak Analyst Sentiment Amid Industry Trends

Market Snapshot

Headline Takeaway: Solaredge (SEDG) remains in technical neutrality with a wait-and-see stance, but fundamentals and analyst sentiment are dragging down confidence.

News Highlights

The semiconductor industry continues to be a focal point, with recent news underscoring global efforts to bolster supply chains and reduce reliance on China. On May 30, McKinsey weighed in on U.S. tariffs and their likely effects on chip manufacturers. The report highlights a dynamic regulatory environment that could influence Solaredge's operations.

On the same day, Lansforsakringar Fondforvaltning AB publ made a $11.77 million investment in NXP Semiconductors (NXPI), indicating a broader shift in capital toward industry leaders. Additionally, Japan and the U.S. are reported to be negotiating cooperation on rare earths and semiconductors, a move that could impact global sourcing and cost structures across the sector.

These developments point to a highly competitive and policy-sensitive environment, which Solaredge must navigate carefully.

Analyst Views & Fundamentals

The consensus among analysts is clearly bearish. The simple average rating for SEDG is 3.00 out of 10, while the performance-weighted rating is only 0.56, reflecting poor historical accuracy and minimal confidence in recent forecasts.

• Roth Capital, Wells Fargo, and UBS all issued Underperform ratings over the past 20 days. These ratings are supported by historical win rates of 0.0% to 20.0%, with average returns ranging from 0.44% to -1.21%.
• Analyst activity remains limited, with no strong bullish signals emerging from recent reports.

Key fundamental factors for Solaredge include:

• Net cash flow from operating activities per share (YoY growth rate): 109.57% – score of 3.00 (internal diagnostic score out of 10).
• Total profit (YoY growth rate): 34.63% – score of 0.00.
• Cash-MV ratio: 4.42% – score of 2.00.
• Net profit attributable to parent company shareholders / Net profit: 100.00% – score of 1.00.
• PCF (Price to Cash Flow): -106.54 – score of 1.00.
• Interest coverage ratio (EBIT / Interest expense): -89.84% – score of 1.00.

These values show some positive momentum in cash flow, but earnings and profitability remain under pressure, reflected in the overall fundamental score of 2.96.

Analyst sentiment and fundamentals appear to align with the current price rise of 37.75% over the short term, though the weighted expectations mismatched suggests caution is warranted.

Money-Flow Trends

Big money is showing mixed behavior, with large and extra-large fund inflows scoring 0.51 and 0.50 respectively, indicating a slight positive trend in mid- to small-sized capital flows. However, block fund flow trends are negative at 0.498, suggesting institutional outflows.

Despite the positive overall inflow ratio of 0.500, the fund-flow score of 7.92 (a good rating on the 0-10 scale) suggests retail and mid-cap inflows are buoying the stock, but big players remain cautious.

Key Technical Signals

Technically, Solaredge is in a mixed state, with both bullish and bearish signals active. The technical score is 5.13, reflecting technical neutrality, and a wait-and-see approach is advised.

• MACD Golden Cross – internal diagnostic score of 8.33, a strong bullish signal.
• Long Lower Shadow – internal diagnostic score of 7.64, also bullish.
• Long Upper Shadow – internal diagnostic score of 7.46, showing moderate bullish momentum.
• WR Overbought and RSI Overbought – both internal diagnostic scores of 1.21 and 1.00 respectively, indicating bearish pressure.

Recent candlestick patterns from August 15–20 show a mix of MACD Golden Crosses, Long Shadows, and overbought signals, suggesting increased volatility and indecision in the market.

Key Insight: Technical indicators suggest a volatile state with unclear direction. Long and short signals are balanced, so traders should closely watch for new breakout signals before committing.

Conclusion

Solaredge remains in a holding pattern as analysts and fundamentals remain bearish, while technicals are mixed. With a fundamental score of 2.96, a technical score of 5.13, and a fund-flow score of 7.92, the stock is not showing a clear path forward.

Actionable Takeaway: Investors should consider waiting for a clearer technical breakout or improved fundamentals before entering or adding to positions. With analyst sentiment and earnings momentum weak, it might be wise to monitor upcoming earnings or sector developments for a potential catalyst.