TD Cowen raised its target price on Enphase Energy (ENPH) to $40.00 from $35.00 while maintaining a Hold rating, pointing to improved near-term guidance and inventory dynamics that support the company’s outlook.
The firm called out Enphase’s raised first-quarter 2026 revenue guidance of $270 million to $300 million, up from the prior $250 million level. TD Cowen attributed much of that improvement to roughly $35 million in Safe Harbor provisions that bolstered the quarter’s expectations. The research note also highlights that, per InvestingPro data, Enphase remains profitable and holds more cash than debt on its balance sheet.
TD Cowen’s analysis identified a notable 21% quarter-over-quarter increase in U.S. demand for Enphase products. The research firm tied that surge to the approaching expiration of the 25D tax credit, which pulled installations forward and led to lean channel inventory heading into the period.
Despite the firmer guidance and demand acceleration in the U.S., TD Cowen underscored persistent headwinds for the solar-technology company. Tariffs are estimated to impose about a 5% drag on margins, and the firm signaled further weakening in the European market as an ongoing concern.
The new $40.00 price target is derived from 13x EV/EBITDA and 16x P/E multiples applied to TD Cowen’s 2027 estimates, which incorporate 45X credits. The note singles out the ramp-up of IQ9 microinverters and growing battery product shipments as key contributors for Enphase’s potential improvement in the second half of the year.
Enphase’s recent operational results provided the backdrop for these analyst moves. The company posted fourth-quarter 2025 earnings per share of $0.71, above the $0.58 consensus, and reported $343.3 million in revenue versus an expected $341.3 million. Those results, together with the revised first-quarter guidance, appear to have shifted several broker views.
RBC Capital upgraded Enphase from Sector Perform to Outperform, citing confidence in a recovery in residential solar demand, and raised its price target to $54.00 from $31.00. BMO Capital moved the stock from Underperform to Market Perform, calling the outlook improved after Enphase’s Q1 2026 revenue guidance, and adjusted its target to $41.00 from $31.00. Collectively, these analyst actions point to a more positive market reception for Enphase among some firms.
Market data referenced in the research note indicated the stock had fallen nearly 8% over the past week to a recent price of $37.28, even as InvestingPro’s fair-value assessment suggested the shares were trading below intrinsic value. TD Cowen’s analysis therefore balances stronger guidance and product ramps against tariff-related margin pressure and softness in Europe.
For investors, the narrative centers on whether the company’s product execution - particularly the IQ9 microinverter rollout and battery deployments - can offset tariff cost pressures and regional demand variability through 2026 and into 2027.
Key points
- TD Cowen raised its Enphase price target to $40 from $35 and kept a Hold rating, citing higher Q1 2026 guidance.
- U.S. demand grew 21% quarter-over-quarter as the 25D tax credit expiration pulled installations forward, producing lean channel inventory.
- Other brokers upgraded ratings and lifted targets after Enphase beat Q4 2025 EPS and revenue estimates; RBC and BMO both moved more positive.
Risks and uncertainties
- Tariffs are creating about a 5% margin headwind for Enphase, pressuring profitability and pricing power.
- The European market is weakening, which could weigh on international revenue contributions.
- Execution risk remains around scaling IQ9 microinverters and battery products to deliver the second-half performance cited by TD Cowen.