Enphase Energy Stock Sinks as Analyst Reviews Sector

Options traders are blasting the equity in the options pits

Digital Content Manager
Apr 21, 2022 at 2:42 PM
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Enphase Energy Inc (NASDAQ:ENPH) is sinking today, last seen down 11.3% to trade at $158.40 , after the equity attracted a price-target cut from Piper Sandler to $220 from $230. The brokerage firm is taking a hard look at the renewable energy sector, weighing demand amid the war in Ukraine, supply chain issues, high inflation, and key policy decisions.

Today's dip has the security trading at its lowest level since March, after the $220 level turned down a rally earlier this month. Shares are now pacing for their worst single-day drop since January, while eyeing their fourth loss in five sessions. Year-to-date, ENPH carries a 13.7% loss.

ENPH Intraday

Analysts are overwhelmingly optimistic towards Enphase Energy stock, though, with 15 of 21 in question calling it a "buy" or better, while six said "hold." Plus, the 12-month consensus price target of $225.41 is a 41.6% premium to current levels. This means more price-target cuts could be on the horizon.

Options traders are blasting the security in the options pits today. So far, 11,000 calls and 11,000 puts have crossed the tape, which is double the volume that is typically seen at this point. Most popular is the 4/22 160-strike put, followed by the 180-strike put in the same series.

It seems like a penchant for puts has been the norm lately, though. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), ENPH's 10-day put/call volume ratio of 0.92 ranks higher than 84% of readings in its annual range. This means that while calls are still outnumbering long puts on an overall basis, the latter are getting picked up at a much quicker-than-usual pace. 

Now looks like a solid opportunity to bet on the stock's next move with options, too. ENPH's Schaeffer's Volatility Scorecard (SVS) sits at 97 out of 100, meaning the equity has exceeded option traders' volatility expectations during the past year.


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