Out Fox The $treet

  Enphase Energy, Inc. has seen initial signs of a turnaround in the residential solar business in key European countries, but actual demand is lower than expected. The company has been under shipping demand to reduce inventory in the channel, but the market forecasts a nearly 70% boost in sales from the current sell-through levels. The stock already trades at 20x '26 EPS targets, with many questions about the aggressive growth required to reach those levels. Looking for a portfolio of ideas like this one? Members of Out Fox The Street get exclusive access to our subscriber-only portfolios.  Learn More » The solar space has gone through a digestion phase with light at the end of the tunnel finally.  Enphase Energy, Inc.  ( NASDAQ: ENPH ) has seen initial signs of the residential solar business turning in key European countries, but  the actual demand was far less than expected. My  investment thesis  remains Neutral on the stock after the recent rally ...

Summary SolarCity reported Q4 earnings that missed analyst targets. A couple of negative trends continue to pop up. The stock isn't likely to gain traction without proper resolution of these negative trends. SolarCity (NASDAQ: SCTY ) remains good at installing new rooftop solar power systems at breakneck speed. The company though is slowly losing momentum in convincing investors that these systems make a good investment with the outlandish operating expenses. After another miss and more importantly continuing negative trends, investors don't appear so convinced that the growing solar deployments are adding the same value as proposed by the management team. Read the full article at Seeking Alpha. Disclosure: No positions mentioned. Please review the disclaimer page for more details. 

Summary Buying Silevo makes SolarCity into a vertical integrator in the solar space. Higher efficiency modules promised aren't as industry leading as promised. The stock valuations of vertical integrators in the solar industry leave a lot to be desired. With the announcement a couple of weeks ago that SolarCity ( SCTY ) was buying a manufacturer of solar modules, the market sent the stock soaring for questionable reasons. The biggest issue with any vertical integration is that the company is now somewhat trapped into a technology instead of pursuing the most economical solution available on the market. Secondarily, the solar module market has never lacked from investments, nor is the manufacturers historically overly profitable. Read the full article at Seeking Alpha. Disclosure: No position mentioned. Please review the disclaimer page for more details. 

After warning investors back during mid-May to not fall for the hype on the soaring SolarCity ( SCTY ) , the stock spent the next five months in a downtrend. Only recently had the stock moved slightly higher than the warning level until Goldman Sachs ( GS ) issued an upgrade that caused the stock to soar over 11% at one point to a new all-time high at $67.14. SolarCity is a leader in the rooftop solar panel market and famously has Elon Musk as the Chairman of the Board. For those living under a rock, Elon is a revolutionary investor and inventor that is the CEO of both Tesla Motors ( TSLA ) and SpaceX . SolarCity offers solar power directly to consumers, businesses and government organizations for less than they spend on utility bills while taking care of the design and permitting process to get the panels installed. In addition, it handles all the monitoring and maintenance to ensure the rooftop solar panels continue to work properly. Read the full article at Seekin...

Before anybody gets carried away, remember that when Warren Buffett buys something it's because the deal is too good to pass up. Or the seller might just be that desperate. In this case, it doesn't appear that First Solar ( FSLR ) was overly desperate to unload the project, but rather Buffett's MidAmerican Energy saw an opportunity to buy at an attractive price with locked in high power rates. Contrary to initial  Reuters reports  about the deal, this isn't likely a Buffett endorsement of the solar industry and if anything could be a signal that he and the executives at MidAmerica expect the solar model going forward to be not as appealing and possibly negative enough to limit supply. Would he really buy into a market where rates are going to crater due to oversupply? Well, maybe with a 25 year iron clad contract; though I'd be worried about the contract being voided if pricing deteriorated too far. Read the full article at Seeking Alpha.  Disclosure:...

Back in February, I did a  webinar  for Covestor and highlighted that renewable energy was my least favorite sector due to the expected reduction in subsidies in Europe. Witin the last couple of weeks, numerous US solar companies have gone bankrupt including the infamous Solyndra that US President Obama visited. The biggest cause for the bankrupties has been the claim that China subsidizes their solar industry to the detriment of US firms. Considering the previous negativity on the sector, the thought crossed my mind that the collapse of competition and continued high prices of oil and gasoline might make the sector worth another look. Read full article at Seeking Alpha.  Disclosure: No positions. Please review the disclaimer page for more details.