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NASDAQ:ENPH is showing good growth, while it is not too expensive.

By Mill Chart

Last update: Nov 30, 2023

Here's ENPHASE ENERGY INC (NASDAQ:ENPH) for you, a growth stock our stock screener believes is undervalued. NASDAQ:ENPH is scoring impressively in terms of growth while demonstrating strong financials. On top of that, it remains attractively priced. Let's break it down further.

Evaluating Growth: NASDAQ:ENPH

A key component of ChartMill's stock assessment is the Growth Rating, which spans from 0 to 10. This rating evaluates diverse growth factors, such as EPS and revenue growth, considering both past performance and future projections. NASDAQ:ENPH has received a 8 out of 10:

  • ENPH shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 39.84%, which is quite impressive.
  • ENPH shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 69.42% yearly.
  • The Revenue has grown by 34.38% in the past year. This is a very strong growth!
  • The Revenue has been growing by 52.11% on average over the past years. This is a very strong growth!
  • ENPH is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 15.43% yearly.
  • The Revenue is expected to grow by 18.10% on average over the next years. This is quite good.

Understanding NASDAQ:ENPH's Valuation

To assess a stock's valuation, ChartMill utilizes a Valuation Rating on a scale of 0 to 10. This comprehensive assessment considers various valuation aspects, comparing price to earnings and cash flows, while factoring in profitability and growth. NASDAQ:ENPH has achieved a 6 out of 10:

  • Based on the Price/Earnings ratio, ENPH is valued a bit cheaper than the industry average as 71.43% of the companies are valued more expensively.
  • Compared to an average S&P500 Price/Earnings ratio of 24.54, ENPH is valued a bit cheaper.
  • Based on the Price/Forward Earnings ratio, ENPH is valued a bit cheaper than 73.33% of the companies in the same industry.
  • Compared to an average S&P500 Price/Forward Earnings ratio of 19.65, ENPH is valued a bit cheaper.
  • Based on the Enterprise Value to EBITDA ratio, ENPH is valued a bit cheaper than the industry average as 68.57% of the companies are valued more expensively.
  • 88.57% of the companies in the same industry are more expensive than ENPH, based on the Price/Free Cash Flow ratio.
  • ENPH has an outstanding profitability rating, which may justify a higher PE ratio.
  • ENPH's earnings are expected to grow with 21.77% in the coming years. This may justify a more expensive valuation.

Looking at the Health

ChartMill assigns a proprietary Health Rating to each stock. The score is computed by evaluating various liquidity and solvency ratios and ranges from 0 to 10. NASDAQ:ENPH was assigned a score of 7 for health:

  • ENPH has an Altman-Z score of 5.26. This indicates that ENPH is financially healthy and has little risk of bankruptcy at the moment.
  • The Altman-Z score of ENPH (5.26) is better than 61.90% of its industry peers.
  • ENPH has a debt to FCF ratio of 1.60. This is a very positive value and a sign of high solvency as it would only need 1.60 years to pay back of all of its debts.
  • ENPH's Debt to FCF ratio of 1.60 is fine compared to the rest of the industry. ENPH outperforms 68.57% of its industry peers.
  • Even though the debt/equity ratio score it not favorable for ENPH, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
  • ENPH has a Current Ratio of 3.36. This indicates that ENPH is financially healthy and has no problem in meeting its short term obligations.
  • ENPH has a Quick Ratio of 3.13. This indicates that ENPH is financially healthy and has no problem in meeting its short term obligations.
  • ENPH has a Quick ratio of 3.13. This is in the better half of the industry: ENPH outperforms 63.81% of its industry peers.

Understanding NASDAQ:ENPH's Profitability

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NASDAQ:ENPH, the assigned 8 is noteworthy for profitability:

  • ENPH has a Return On Assets of 16.09%. This is amongst the best in the industry. ENPH outperforms 82.86% of its industry peers.
  • ENPH's Return On Equity of 56.36% is amongst the best of the industry. ENPH outperforms 95.24% of its industry peers.
  • ENPH has a Return On Invested Capital of 19.47%. This is amongst the best in the industry. ENPH outperforms 83.81% of its industry peers.
  • ENPH had an Average Return On Invested Capital over the past 3 years of 17.57%. This is significantly above the industry average of 12.18%.
  • The last Return On Invested Capital (19.47%) for ENPH is above the 3 year average (17.57%), which is a sign of increasing profitability.
  • ENPH has a Profit Margin of 21.08%. This is in the better half of the industry: ENPH outperforms 76.19% of its industry peers.
  • ENPH has a Operating Margin of 22.70%. This is in the better half of the industry: ENPH outperforms 75.24% of its industry peers.
  • In the last couple of years the Operating Margin of ENPH has grown nicely.
  • In the last couple of years the Gross Margin of ENPH has grown nicely.

More Affordable Growth stocks can be found in our Affordable Growth screener.

For an up to date full fundamental analysis you can check the fundamental report of ENPH

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.

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ENPHASE ENERGY INC

NASDAQ:ENPH (2/21/2024, 7:00:02 PM)

Premarket: 127.75 +1.51 (+1.2%)

126.24

-1.31 (-1.03%)

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