SolarEdge Technologies to Benefit From Rising U.S. Solar Demand

SolarEdge Technologies SEDG has been taking significant steps to expand its manufacturing capacity in the United States. The company is benefiting from its optimized inverter solutions to address a broad range of solar market segments, from residential solar installations to commercial and small utility-scale solar installations.

However, this Zacks Rank #3 (Hold) company faces risks related to higher U.S. tariffs and potential trade escalations.

Factors Acting in Favor of SEDG

SolarEdge Technologies’ optimized inverter solutions address a broad range of solar market segments, from residential solar installations to commercial and small utility-scale solar installations. Thanks to the growing solar demand in recent times, as of Sept. 30, 2025, the company shipped approximately 60.1 GW of DC optimized inverter systems and approximately 3 GWh of its batteries for PV applications. Such a solid shipment count should boost the company’s future revenue growth.

SEDG has also been enhancing its manufacturing capacities in the United States to reap the benefits of the long-term growth opportunities offered by this nation in terms of solid solar installation capabilities. As part of its efforts to streamline and centralize its manufacturing in the United States, SolarEdge has discontinued manufacturing in China, Mexico and Hungary. The company is also optimizing its U.S. manufacturing footprint, which now includes residential inverters in Texas, optimizers and commercial inverters in Florida, and batteries in Utah.

In June 2025, SolarEdge announced the ramp-up of its new manufacturing site in Salt Lake City, UT. Following this ramp-up, SolarEdge will now produce its full U.S. residential inverter, Power Optimizer, and battery product suite on American soil. Such enhancement of SEDG’s manufacturing capacity should enable it to capture more shares of the expanding U.S. solar market.

Challenges Faced by SEDG

The recently imposed higher tariffs by the U.S. government on the import of goods from foreign nations have created a significant uncertainty for global trade and companies operating worldwide, with SolarEdge Technologies being no exception. Although SEDG currently manufactures the vast bulk of its products in the United States, a minor portion is still manufactured in its Israel-based Sella 1 facility. Moreover, certain critical subcomponents for SolarEdge’s products are still sourced from outside the United States. 

Therefore, if these heightened tariffs remain or there’s any escalation in trade tensions in the near term — resulting in trade restrictions or other retaliatory measures on SolarEdge’s products or components or subcomponents originating from countries outside the United States — it could be detrimental to the company’s growth.

SEDG’s Share Price Performance

In the past six months, shares of the company have risen 85.7% compared with the industry’s 58.2% growth.

Stocks to Consider

Some better-ranked stocks from the same industry are Canadian Solar CSIQ, Tigo Energy, Inc. TYGO and FTC Solar FTCI, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for CSIQ’s 2025 EPS implies a decline of 121.4% from that recorded in 2024. The Zacks Consensus Estimate for CSIQ’s 2025 sales implies a year-over-year decline of 3.8%. 

The Zacks Consensus Estimate for TYGO’s 2025 EPS calls for an increase of 76% from that recorded in 2024. The Zacks Consensus Estimate for TYGO’s 2025 sales implies a year-over-year increase of 91.9%. 

The Zacks Consensus Estimate for FTCI’s 2025 EPS calls for an increase of 33.6% from that recorded in 2024. The Zacks Consensus Estimate for FTCI’s 2025 sales implies a year-over-year improvement of 108.6%. 

 

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This article originally published on Zacks Investment Research (zacks.com).

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