SolarEdge: How long is this going to last?

Investors comment negatively on SolarEdge

The Internet can amplify or even turn moods. Depending on the intensity of discussion, i.e. the number of word posts on social media and the frequency and depth of the change in sentiment, new assessments for stocks emerge. For Solaredge, we measured below-average activity over the long term in terms of discussion intensity and assign a Sell rating to this signal. The rate of change in sentiment was rather poor, and a negative change could be identified. We therefore arrive at the overall result of “Sell” for the long-term sentiment picture.

In comparison: what price return does the stock offer?

Compared to the average annual performance of stocks from the same sector (“Information Technology”), Solaredge is more than 54 percent below, with a return of 3.86 percent. The “semiconductor and semiconductor equipment” sector has a median return over the past 12 months of 44.06 percent. Again, Solaredge is well below that at 40.2 percent. This performance of the stock over the past year leads to a “sell” rating in this category.

Fundamental analysis on SolarEdge

The P/E ratio (price-earnings ratio) is currently 128.97 and is 67 percent above the industry average (industrySemiconductor and semiconductor equipment) of 77.28. The stock is thus overvalued from today’s perspective. Therefore, Solaredge receives a “Sell” rating at this level.

How SolarEdge performs in the RSI

The Relative Strength Index (RSI) is a well-known tool from technical analysis to assess whether a stock is currently “overbought” or “oversold”. This puts price movements over time in relation to each other. We look at the RSI on a 7-day and on a 25-day basis for Solaredge. Let’s start with the 7-day RSI, which is currently 31.87 points. This means that Solaredge is neither overbought nor -sold at the moment. Thus, the stock is rated as a “hold”. How does the 25-day RSI look? In contrast to the RSI of the last 7 trading days, Solaredge is oversold on this basis. The thus deviating rating of the stock for the 25-day RSI is therefore a “buy” rating. Solaredge is thus given a bottom-line “Buy” rating for this point in our analysis.

What is the sentiment in social media?

Investor sentiment is an important sentiment indicator for the assessment of a stock. Recently, the share of Solaredge was also in the focus of discussions in the social media. Thereby, mainly and in the majority negative opinions were published. In addition, the opinion market in recent days was particularly concerned with the negative topics around Solaredge. This circumstance triggers an overall “Sell” rating. Further studies and investigations of the communicative activities show on the analytical side that in particular “Sell” signals were given. There were three signals (3 Sell, 0 Buy). The overall result at this level is therefore a “sell” signal. In summary, the analysis of investor sentiment thus results in an overall “Sell” rating.

Clear Buy recommendation from analysts

A total of 19 analyst ratings have been issued on Solaredge stock in the last twelve months. Of these, 14 ratings were “Buy,” 4 were “Hold” and 1 was “Sell.” In summary, this results in a “Buy” rating for Solaredge stock. A look at the past month reveals. 4 Buy, 2 Hold and 0 Sell recommendations are available from the most recent period. Thus, the stock is considered a “Buy” stock from an institutional perspective in the short term. Within the ratings conducted by the analysts, the average price target was USD 350.67. The stock thus has an upside potential of 16.15 percent, based on the last closing price (USD 301.91). This results in a “Buy” recommendation. The bottom line is that Solaredge thus receives a “Buy” rating for this point of the analysis.