Enphase Energy Jumps on SunPower Microinverter Acquisition

By Chris Lange Updated Jan 11, 10:24PM EST · Published Jun 13, 9:56AM EDT

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Enphase Energy Jumps on SunPower Microinverter Acquisition — © Federico Rostagno / iStock

Enphase Energy, Inc. (NASDAQ: ENPH) saw shares up sharply on Wednesday after the firm announced that it would be acquiring SunPower Corp.’s (NASDAQ: SPWR) microinverter business. The transaction is expected to close at the end of the third quarter of 2018.

According to the deal, Enphase will acquire SunPower’s microinverter business for $25 million in cash and 7.5 million shares of Enphase common stock.

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Some of the key highlights of the acquisition include:

Advances AC Modules (ACM) as the future of residential solar

Enhances SunPower’s Equinox Home Solar System with a custom line of Enphase’s IQ microinverters for use with SunPower AC Modules

Enphase expects to add $60-$70 million annualized revenue in second half of 2019 at 33%-35% gross margin

Adds over 140 patents to Enphase’s strong IP portfolio

Expects to close by end of the third quarter of 2018 with initial IQ shipments in the fourth quarter

$25 million cash to be funded from Enphase’s balance sheet in two installments

Badri Kothandaraman, President and CEO of Enphase, added:

We are pleased to become the microinverter supplier for SunPower’s AC Modules. The IQ 7XS 320W AC microinverter in an ACM strongly complements SunPower’s high efficiency solar cells, communication and racking to create a high performance, high quality and easy-to-use Equinox Home Solar System, providing exceptional value to homeowners, dealers and architects.

Shares of Enphase closed Tuesday at $4.50, with a consensus analyst price target of $6.25 and a 52-week range of $0.76 to $6.37. In early trading indications Wednesday the stock was up about 32% at $5.95.

Shares of SunPower closed Tuesday at $7.86, with a consensus analyst price target of $8.13 and a 52-week range of $6.46 to $11.70. In early trading indications Wednesday the stock was up over 2% at $8.05.

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About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.