MILPITAS, Calif. - SolarEdge Technologies, Inc. (NASDAQ:SEDG), recognized for its smart energy technology, has announced that its photovoltaic (PV) inverters are now certified under the European Commission's New Radio Equipment Directive (RED) Article 3.3, focusing on cybersecurity. The directive, which is set to be implemented in August 2025, mandates that all IoT products with wireless connectivity sold in Europe adhere to stringent cybersecurity requirements.
The new RED Article 3.3 is particularly relevant to the solar industry, which is increasingly integral to global energy generation and is deemed critical energy infrastructure in various countries. The regulation aims to enhance network protection, personal data security, and reduce fraud risks.
Ronen Faier, Interim CEO of SolarEdge, emphasized the company's commitment to safety and security in product design, stating, "With the rapid growth of solar adoption, the need for non-negotiable cyber security regulations is critical to safeguarding future energy security."
This development follows SolarEdge's recent compliance with the UK's Product Security and Telecommunications Infrastructure (PSTI) regulation, effective since April 2024. The company's proactive approach to meeting and setting cybersecurity standards in PV technology showcases its dedication to fostering secure energy progress.
SolarEdge's portfolio includes solutions across PV, storage, EV charging, batteries, and grid services. The company's DC optimized inverter is designed to enhance power generation and reduce the cost of energy produced by PV systems.
The certification of SolarEdge's inverters was verified through a third-party evaluation by Kiwa, a premier European product certification lab. This achievement positions SolarEdge as a proactive player in meeting future regulatory requirements and underscores its role in promoting cybersecurity in the smart energy sector. The information in this article is based on a press release statement from SolarEdge Technologies, Inc.
In other recent news, SolarEdge Technologies has faced a series of adjustments from industry analysts. RBC Capital has maintained its Sector Perform rating on the company, but reduced the price target to $25.00, citing a more conservative outlook on demand and selling price assumptions. This comes alongside GLJ Research's significant reduction of SolarEdge's price target to $3.90, maintaining a Sell rating on the stock based on a conservative valuation metric. Meanwhile, Morgan Stanley has reduced its price target for SolarEdge due to slower expected revenue growth and narrower margins, maintaining an Equalweight rating. The company reported second-quarter revenues of approximately $265 million and aims for a revenue target of $550 million for the second quarter of 2025. Jefferies has downgraded SolarEdge's stock from Hold to Underperform, citing a subdued outlook in Europe and strong competition. Amid these financial projections and analyst adjustments, SolarEdge's management structure has seen significant changes, with former CEO Zvi Lando stepping down and ex-CFO Ronen Faier stepping in as interim CEO. Ariel Porat, previously Senior VP of Finance, has assumed the CFO role. These are the recent developments in the company's journey.
InvestingPro Insights
While SolarEdge Technologies (NASDAQ:SEDG) demonstrates forward-thinking in cybersecurity compliance, recent financial data from InvestingPro paints a challenging picture for the company. The stock has experienced significant declines, with a one-year price total return of -79.12% as of the latest data. This downturn is reflected in the company's market capitalization, which stands at $985.84 million.
InvestingPro Tips highlight that SolarEdge is "trading at a low Price / Book multiple" of 0.47, which could indicate the stock is undervalued. However, this must be weighed against the fact that the company is "quickly burning through cash" and "suffers from weak gross profit margins," which stood at just 7.82% in the last twelve months.
The company's financial health appears precarious, with revenue growth showing a steep decline of -58.74% over the last twelve months. This aligns with the InvestingPro Tip that "analysts anticipate sales decline in the current year." Moreover, SolarEdge's operating income margin is deeply negative at -31.63%, suggesting significant operational challenges.
Despite these headwinds, it's worth noting that SolarEdge "operates with a moderate level of debt" and "liquid assets exceed short term obligations," which may provide some financial flexibility as the company navigates this difficult period.
For investors seeking a more comprehensive analysis, InvestingPro offers 19 additional tips for SolarEdge, providing a deeper understanding of the company's financial position and market performance.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.