Enphase Energy Sees Massive $10.65 Million Insiders Purchase

Corporate insiders know more about their businesses than anyone else. If these individuals are buying company stock, it’s often worth taking a closer look. 

In this report, we are going to highlight some interesting insider buying at Enphase Energy (ENPH:US). Enphase Energy is an American energy technology company that develops and manufactures solar micro-inverters, battery energy storage, and electric vehicle (EV) charging stations primarily for residential customers. Founded in 2006, it was the first company to successfully commercialize the solar micro-inverter. It is listed on the Nasdaq and currently has a market cap of $22.5 billion. 

Insider Buying at Enphase Energy

2iQ data shows that on April 26 & May 02, Board Member Thurman John Rodgers along with Vice President & Chief Financial Officer Ya-Ling (Mandy) Yang purchased 64,300 ENPH shares at a price of around $160 per share. This trading activity cost the insiders approximately $10.65 million.

Industry Experience

Mr. Rodgers – who previously founded Cypress Semiconductor Corporation – has considerable industry experience. He has served on the board of Enphase since January 2017. However, he is also presently a member of the board of directors of Enovix Corporation (lithium-ion batteries), Solaria Corporation (advanced solar energy products) and WaterBit, Inc. (IoT-based watering). Meanwhile, he has served as a member of the board of directors of SunPower Corporation. Given his background, he is likely to have a good understanding of Enphase’s prospects. 

It’s worth noting that Mr. Rodgers has been a seller of ENPH stock in the past. Back in early 2020, he offloaded a lot of stock when it was trading near $50 (shortly before it tanked due to the coronavirus). 

Mandy Yang also boasts twenty years of industry experience, with a record of service at companies like Tesla and SunPower Corporation. From her expertise in Financial reporting and her qualification as a CFA, she is likely to have a critical awareness of Enphase’s position in the market.

Buying the Dip

Enphase stock took a hit in late April after the company provided weaker-than-expected Q2 revenue guidance. 

Enphase said that it expects revenue for the quarter to amount to between $700 million and $750 million – below the consensus forecast of $773 million. This sent the stock down from nearly $220 to around $165. 

On the back of the weak revenue guidance, analysts at both JP Morgan and Piper Sandler cut their price targets for the stock. Piper Sandler analyst Kashy Harrison said that he expects the stock to be pressured in the near term due to the flat quarter-over-quarter Q2 revenue profile. 

Mr. Rodgers and Ms. Yang clearly expect the stock to bounce back, however. The fact that Mr. Rodgers has invested over $10 million in the company suggests that he sees a lot of value in the stock right now. 

And this is understandable. Right now, the stock is more than 50% below its 52-week highs. And looking at analysts’ 2024 earnings forecasts, it is trading on a forward-looking price-to-earnings (P/E) ratio of just 22, which is not particularly high given the company’s historical growth rate. 

Given the insiders’ background and Mr. Rodgers investment value, we see his buying activity as a bullish development.