SEDG - SolarEdge Technologies: Ugly Story Gets Worse

2024-06-26 12:29:21 ET

Summary

• SolarEdge Technologies, Inc. shocked the market with signs of creating extra demand via aggressive financing, leading to a collapse in stock price.
• The company faces challenges with excessive inventory levels and additional customer financings.
• SolarEdge issues a $300 million convertible debt offering in a sign the inventory issue will remain a long-term problem.
• The stock should be avoided until the red flags are cleared up.

While SolarEdge Technologies, Inc. ( SEDG ) was a promising turnaround story due to under shipping demand, the company just shocked the market with signs of creating extra demand via aggressive financing. Moreover, the solar energy company had to raise additional capital, crushing the stock. My investment thesis remains Neutral on the stock after the collapse to new lows due to an expected sales rebound....

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