SMTGF - 64% Downside For Enphase Energy - It's Not Always Sunny In Solardelphia

Executive Summary

We are short Enphase Energy with a target price of $13.82, yielding a target downside of 64% based on the current share price of $38.96. Our thesis consists of (1) Enphase's accounting technicalities driving one-time success in 2019, (2) Enphase's inability to capture incremental global capacity growth, and (3) the diminution of Enphase's competitive advantage.

Business Overview

Enphase is a global energy technology company founded in March 2006 in Fremont, California. Enphase designs and manufactures software-driven home energy solutions that span solar generation, home energy storage and web-based monitoring and control. Enphase was