Taking everything into account, ENPH scores 5 out of 10 in our fundamental rating. ENPH was compared to 113 industry peers in the Semiconductors & Semiconductor Equipment industry. Both the profitability and the financial health of ENPH get a neutral evaluation. Nothing too spectacular is happening here. A decent growth rate in combination with a cheap valuation! Better keep an eye on ENPH.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year ENPH was profitable.
In the past year ENPH had a positive cash flow from operations.
ENPH had positive earnings in each of the past 5 years.
Each year in the past 5 years ENPH had a positive operating cash flow.

1.2 Ratios

ENPH has a Return On Assets of 5.89%. This is in the better half of the industry: ENPH outperforms 69.91% of its industry peers.
Looking at the Return On Equity, with a value of 19.66%, ENPH belongs to the top of the industry, outperforming 84.96% of the companies in the same industry.
ENPH has a better Return On Invested Capital (8.61%) than 77.88% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ENPH is in line with the industry average of 10.78%.

		Industry Rank	Sector Rank
ROA	5.89%
ROE	19.66%
ROIC	8.61%

ROA(3y)9.67%

ROA(5y)9.44%

ROE(3y)35.03%

ROE(5y)33.31%

ROIC(3y)10.89%

ROIC(5y)13.62%

1.3 Margins

The Profit Margin of ENPH (12.93%) is better than 70.80% of its industry peers.
ENPH's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 14.31%, ENPH is in the better half of the industry, outperforming 70.80% of the companies in the same industry.
In the last couple of years the Operating Margin of ENPH has declined.
ENPH has a Gross Margin of 49.11%. This is in the better half of the industry: ENPH outperforms 60.18% of its industry peers.
ENPH's Gross Margin has improved in the last couple of years.

		Industry Rank	Sector Rank
OM	14.31%
PM (TTM)	12.93%
GM	49.11%

OM growth 3Y-24.77%

OM growth 5Y-16.62%

PM growth 3Y-9.82%

PM growth 5Y-21.45%

GM growth 3Y5.64%

GM growth 5Y5.94%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

ENPH has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
ENPH has less shares outstanding than it did 1 year ago.
ENPH has more shares outstanding than it did 5 years ago.
The debt/assets ratio for ENPH is higher compared to a year ago.

2.2 Solvency

ENPH has an Altman-Z score of 2.36. This is not the best score and indicates that ENPH is in the grey zone with still only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.36, ENPH is not doing good in the industry: 66.37% of the companies in the same industry are doing better.
The Debt to FCF ratio of ENPH is 5.54, which is a neutral value as it means it would take ENPH, 5.54 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of ENPH (5.54) is comparable to the rest of the industry.
A Debt/Equity ratio of 0.57 indicates that ENPH is somewhat dependend on debt financing.
ENPH has a Debt to Equity ratio of 0.57. This is in the lower half of the industry: ENPH underperforms 69.91% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	0.57
Debt/FCF	5.54
Altman-Z	2.36

ROIC/WACC0.87

WACC9.87%

2.3 Liquidity

ENPH has a Current Ratio of 2.04. This indicates that ENPH is financially healthy and has no problem in meeting its short term obligations.
With a Current ratio value of 2.04, ENPH is not doing good in the industry: 73.45% of the companies in the same industry are doing better.
A Quick Ratio of 1.88 indicates that ENPH should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.88, ENPH is in line with its industry, outperforming 41.59% of the companies in the same industry.

		Industry Rank	Sector Rank
Current Ratio	2.04
Quick Ratio	1.88

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 62.94% over the past year.
Measured over the past years, ENPH shows a very strong growth in Earnings Per Share. The EPS has been growing by 20.06% on average per year.
Looking at the last year, ENPH shows a very strong growth in Revenue. The Revenue has grown by 20.97%.
Measured over the past years, ENPH shows a quite strong growth in Revenue. The Revenue has been growing by 16.34% on average per year.

EPS 1Y (TTM)62.94%

EPS 3Y-0.69%

EPS 5Y20.06%

EPS Q2Q%38.46%

Revenue 1Y (TTM)20.97%

Revenue growth 3Y-1.26%

Revenue growth 5Y16.34%

Sales Q2Q%7.76%

3.2 Future

Based on estimates for the next years, ENPH will show a small growth in Earnings Per Share. The EPS will grow by 7.78% on average per year.
Based on estimates for the next years, ENPH will show a small growth in Revenue. The Revenue will grow by 2.65% on average per year.

EPS Next Y18.22%

EPS Next 2Y-6.7%

EPS Next 3Y4.54%

EPS Next 5Y7.78%

Revenue Next Year10.41%

Revenue Next 2Y-5.23%

Revenue Next 3Y-0.17%

Revenue Next 5Y2.65%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.

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4. Valuation

4.1 Price/Earnings Ratio

ENPH is valuated correctly with a Price/Earnings ratio of 12.44.
Based on the Price/Earnings ratio, ENPH is valued cheaply inside the industry as 96.46% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of ENPH to the average of the S&P500 Index (28.82), we can say ENPH is valued rather cheaply.
With a Price/Forward Earnings ratio of 19.35, ENPH is valued on the expensive side.
Based on the Price/Forward Earnings ratio, ENPH is valued cheaper than 88.50% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of ENPH to the average of the S&P500 Index (25.95), we can say ENPH is valued slightly cheaper.

		Industry Rank	Sector Rank
PE	12.44
Fwd PE	19.35

4.2 Price Multiples

ENPH's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. ENPH is cheaper than 88.50% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ENPH indicates a rather cheap valuation: ENPH is cheaper than 88.50% of the companies listed in the same industry.

		Industry Rank	Sector Rank
P/FCF	24.05
EV/EBITDA	13.03

4.3 Compensation for Growth

ENPH's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
ENPH has a very decent profitability rating, which may justify a higher PE ratio.