Shares of Enphase Energy (ENPH 2.21%) jumped 12% on Wednesday after the company reported fourth-quarter 2021 financial results. Revenue was up 56% to $412.7 million and non-GAAP earnings were $0.73 per share. But it's the outlook and the growth trends in solar that investors got the most excited about.
Enphase's growth continues
For the first quarter of 2022, management expects revenue of $420 million to $440 million, which is a strong sequential increase considering this is typically a slow quarter for residential solar.
There are also strong growth trends in the battery business. Its IQ Battery shipments increased 53% from the third to the fourth quarter in 2021, and growth should continue as batteries become more economical around the world. Enphase is also moving into electric-vehicle (EV) charging with the acquisition of ClipperCreek, which closed during the quarter.
The market is clearly moving toward Enphase Energy's products in a big way with microinverters gaining market share and both energy storage and EV charging getting major tailwinds. Operationally, it's all going right for Enphase Energy.
As much as I like the company's position, shares are trading for 67 times 2021 non-GAAP earnings, which is a hefty premium for a solar energy stock. I like the momentum in the business and on the market but will look for a better value before becoming a buyer of the stock.