Enphase Energy Stock Upgraded on Earnings Beat

Most analysts were already bullish on ENPH

by Josh Selway

Published on Jul 31, 2019 at 9:33 AM
Updated on Jun 24, 2020 at 10:16 AM

Clean energy stock Enphase Energy Inc (NASDAQ:ENPH) is set for record highs, trading up 21.5% before the open thanks to a second-quarter earnings beat. This just extends a strong year for the shares, which sport a lead of almost 360% in 2019, closing Tuesday at $21.65. A few bull notes have come through this morning, and today's move could also be good news for options traders.

But first, at least four brokerage firms have upwardly revised their outlooks since the earnings came out, including an upgrade to "buy" from "neutral" at H.C. Wainwright, which also boosted its price target to $36 from $16. Five of the seven covering brokerage firms already had "strong buy" ratings coming into today.

As for the options activity alluded to, data from the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) shows a 10-day call/put volume ratio of 26.80, which ranks in the 78th annual percentile. This shows call buying has been more popular than normal, so today's gains could be good news for these bulls. To be more specific, peak open interest is at the August 22.50 call.

Despite the equity's absurd technical success, short interest is high. By the numbers, short interest accounts for 18.8% of the float, with 13.2 million shares sold short. If these bears are looking for any solace, they could note that ENPH's 14-day Relative Strength Index (RSI) is running hot, coming in at 67 even before today, so the shares could be due for a short-term breather at the least.


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