To my delight, I noticed that the solar sector hasn’t sparked any discussion. It’s probably no secret that technology is constantly developing and costs are continuously coming down. Globally, wind and solar power produce the cheapest megawatts in favorable production areas.
In the media, the discussion focuses solely on panels. Panels are pure bulk commodities, and the Chinese have steamrolled the market with their efficient production. Nothing interesting from an investor’s perspective. However, solar systems also require other components, and so far, significantly more money has been made with inverters. Apparently, patents/technology matter more, and companies in the industry have more pricing power.
Huawei is a strong player in these areas too, but Israel also knows its stuff. SolarEdge just released its results and is guiding for 60-70 percent growth for the upcoming quarter. An acquaintance designs/installs commercial systems and praised the company’s products, which encouraged me to buy shares. Enphase has also brought completely new technology to the market, and growth has exploded in recent quarters. SolarEdge has been in my portfolio for a longer time, and I bought Enphase for a few hundred to follow it. I should have bought more, as the stock price has risen by something like 400 percent since last year.
I should have written about this earlier if I had been active on the forum, but better late than never for future reference. Markets are growing, but subsidy policies and cycles cause volatility in the markets at regular intervals. Installation volumes have been growing strongly after a small dip, and this is also reflected in company stock prices. Perhaps one can still get in, but stock prices seem to be very volatile in their movements. Cycles come and go quickly, but the quickest might manage to pick up industry companies cheaply.