April 2023 Enphase (ENPH) Stock and Laphroaig Quarter Cask Whiskey Pairing

Website: www.enphase.com

CEO: Badrinarayanan Kothandaraman

Founders: Raghu Belur and Martin Fornage

Market Cap at Time of Article: $28.62B

Current Analyst Recommendations:

On a scale where 1 is a "strong-buy," and 5 is a "sell," the analyst consensus on Enphase is currently at 2.81. This makes ENPH a "buy." With a current price of $209 and an average price target of $301.85,  the DubyaDubya team views ENPH as more of a "strong-buy" considering how the stock has performed in a rough time for the market.

Quarterly Revenue Growth Year-Over-Year: 76%. Yes, you’re reading that right. In a market rocked by inflation, supply chain disruption, and other uncertainties, ENPH accelerated its YOY revenue growth with 56%, 46%, 68%, 81%, and 76% in the most recent quarter.

Insiders: It couldn’t all be perfect. The DubyaDubya team likes our companies to have significant insider holdings, and insiders hold only 2.08% of shares in ENPH. Vanguard Group owns the largest amount of shares at 11.49%.

What makes Enphase (ENPH) worth your hard-earned money for the next decade or more?
As the world population grows, so does demand for energy—and renewable energy sources like solar have seen a jaw dropping level of investment growth and technological advancement. Even if one ignored that virtually all industrialized economies are providing tax breaks, funding subsidies, and research support for solar energy, the sheer volume of market investment in solar energy companies demonstrates how clean energy is becoming essential to meeting our energy needs going forward.

Now, this does NOT mean all solar companies are good investments—even market tailwinds can be overwhelmed by poor management and production inefficiencies. This is why Enphase Energy’s great business performance makes it worth your attention: In the tough business year of 2022, their adjusted operating income was $690 million, up a remarkable 102% from the previous year! Much of this success is due to the quality of their technology (more on that in the next section) and their international focus: though they were founded in the US, their EU revenue increased more than 130% year over year and they’re continuing to scale up the battery side of their business in Germany, Belgium, Austria, France, Spain, and the Netherlands this year.

Why talk about Enphase (ENPH) to all your friends and family?

Enphase has become a leading player in the renewable energy sector, particularly in the solar photovoltaic (PV) industry. Clean energy is seeing a ton of public and private investment, but it’s not enough to just see “solar” in a company’s name and invest. Here’s how ENPH’s tech stands out.

Enphase prides itself on offering easy to install and high-quality microinverters and batteries for home and SMB solar panels. ENPH also has battery products to help store the energy they produce, so they are advancing toward the production of an entire integrated energy system.  ENPH microinverter technology has disrupted the traditional solar power industry by offering a more efficient, reliable, and flexible alternative to conventional string inverters. Microinverters are small devices that convert the direct current (DC) generated by individual solar panels into alternating current (AC), which can be used by households or fed back into the grid. By performing this conversion at the panel level, microinverters optimize the energy production of each solar panel, making the entire solar power system more efficient and resilient.

How is this company disruptive?

Enphase has been a disruptive force in renewable energy for several reasons:

1. Enhanced system performance: ENPH microinverters improve the overall performance of solar power systems by maximizing the output of individual solar panels, even when they are partially shaded or experience different levels of sunlight exposure. These microinverters are superior to traditional string inverters, which only work as well as the lowest-performing panel in the array.
2. Improved reliability and longevity: Microinverters like ENPH’s are also designed to operate at lower individual power levels, which reduces stress on the devices and contributes to longer lifespans.
3. Scalability and flexibility: Enphase's microinverter technology allows for easy expansion of solar power systems, as homeowners can add panels without the need to reconfigure or replace existing inverters. This modular approach provides greater flexibility and simplifies system design and installation.
4. Advanced monitoring and management: Enphase offers an integrated energy management platform called Enlighten, which provides detailed performance monitoring and analytics for both installers and homeowners. This simplifies maintenance, troubleshooting, and system optimization.
5. Integrated energy storage solutions: Enphase also offers energy storage products that can seamlessly integrate with ENPH’s microinverter-based solar power systems. This helps homeowners store excess solar energy for use during peak demand times or power outages.

Conclusion:

Even if you are a clean energy skeptic, the way ENPH has performed in a bleak year for investment offers an excellent argument for this stock. Enphase is a highly efficient business that is well-led and making the most of their growing revenue—all while innovating inside a rapidly growing solar power generation and management market. This means Enphase has positioned itself as both a key player in the transition towards a more sustainable energy future and as a stock that earns the DubyaDubya recommendation.

Whiskey Pairing: Laphroaig Quarter Cask
 Retail: $68 Proof: 96

A Reflection on Smoke, Youth, and Promise

All this talk of clean energy inspired me to go in an opposite, smoky direction for this month’s whiskey review. I chose an old favorite of the DubyaDubya team: Laphroaig Quarter Cask. For scotch lovers, Laphroaig is a distillery legendary for its peaty and smoke-laden whiskies, and its flagship bottle Laphroaig 10-year is much beloved by DubyaDubya crew.

But the quarter cask whiskey zags when you expect a zig. Instead of aging the spirit longer, Laphroaig removed this whiskey at the 5-year mark and finished it inside smaller casks that are one fourth the size of the original barrel. From these “quarter casks” the whiskey earns its name, and from extra wood exposure inside these barrels this scotch acquires bright and rich flavors far beyond its younger years.

At DubyaDubya, we see ourselves much like this whiskey. We don’t come from old money. We don’t have the flush dividends of many senior investors. But we have a smoky fire in our hearts, a gleam in our eyes, and a desire to do something we love just a bit differently than the crowd. In the spirit of youth and promise, let’s lift a dram and celebrate together.

Tasting Notes:

Nose: You can tell this is an Islay whiskey immediately from the flush peat and smoke. However, the younger age of this spirit gives it a zest and butter other Islays lack. Notes of sugary lemon and salty toffee abound.

Palate: The barley cereals of scotches appear alongside a flood of caramel sweetness. Look for the taste of vanilla and sweet chilis.

Finish: You’ll notice the oaky smoke first, easing into a fruity lemon custard roasted a bit longer than usual. If you want a cigar after this one, you’re not alone.

Score – 4/5