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Why Enphase Energy's Shares Popped 5.5% in Trading on Friday

By Travis Hoium - Updated Mar 19, 2021 at 8:47PM

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The fall from earlier this week seems to be over, for now.

What happened 

Shares of solar inverter company Enphase Energy (ENPH 6.00%) jumped as much as 5.5% in trading on Friday after getting an upgrade from Wall Street. Shares are up 4.3% at 2:10 p.m. EDT and look to end a wild week on a positive note. 

So what

Today's move was at least in part due to Susquehanna analyst Biju Perincheril upgrading Enphase Energy's stock to a positive rating from neutral and putting a $200 price target on shares. The better outlook is based on rising estimates for residential solar installations from about 3.6 gigawatts per year through 2025 to 4.3 gigawatts per year. 

Home with solar panels on the roof.

Image source: Getty Images.

It doesn't hurt that solar stocks in general are rising as investors pile back into growth stocks. A sell-off early in the week may have been overdone on concerns that interest rates would keep rising. But rates are still low by historical standards and should help drive growth in solar energy deployments. 

Now what

The volatility this week is part of owning solar stocks and should be expected by investors. Sometimes shares will jump double digits on nothing more than an analyst note, and on other days they'll drop because of changes in interest rates. The long-term story is that solar energy is growing -- and that should help drive growth for solar energy stocks, even if the ride is bumpy along the way. 

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