Shares of microinverter maker Enphase Energy (NASDAQ:ENPH) were down as much as 10.9% in early trading today as the stock's nearly monthlong slide continues. As of 10:50 a.m. EDT, shares were still down 8% on the day, on trading volume that was already higher than the three-month average daily volume.
There are a few things going on today that are pushing the stock lower. The first is that oil is also down today, and that's driving solar stocks lower. Most large solar stocks aren't down over 10%, but Enphase is trading at a premium to most other companies, so that can lead to higher volatility.
Investors are also seeing a potential slowdown in the economy coming, and that could hurt the number of solar installations. For example, falling oil and natural gas prices would make competing energy sources cheaper, reducing the financial incentive for homeowners and business owners to go solar.
Most of today's move can be chalked up to volatility and the fact that Enphase's valuation will make the company more volatile than most. Remember that it was less than two months ago that investors were blown away by its great operating results in the second quarter of 2019. The financial performance is what long-term investors should focus on, not the day-to-day volatility now hitting the stock.