Shares of solar microinverter company Enphase Energy (NASDAQ:ENPH) dropped as much as 8.6% in trading Tuesday after the company announced an acquisition. Shares ended the day off 7.6%.
Enphase announced the acquisition of Sofdesk, a software company that makes digital tools and services intended to simplify the sales process for the residential solar industry. This is another move to increase the software offerings from Enphase, which is quickly pushing into energy storage and smart home systems.
The idea here is that Enphase will be able to offer a full software solution to hundreds of installers. Everything from sales leads to energy storage monitoring would run through Enphase's system, which could both make installers' lives easier and help grow Enphase's bottom line very quickly.
This has been one of the hottest solar energy stocks the past year and despite a relatively positive announcement the stock has fallen. But this could just be profit-taking by investors looking for a reason to sell. I wouldn't take today's news as a reason to jump ship; in fact, it might be just the opposite considering how deeply Enphase is engraining itself in the solar sales process.