If you are wondering whether SolarEdge Technologies at around $29 is a bargain or a value trap after its collapse from prior highs, you are not alone. This breakdown will tackle that question head on.
The stock is still down about 90.6% over three years and 89.9% over five years. However, it has bounced in 2024 with a 99.5% year-to-date gain and a 131.0% return over the last year, despite sliding 19.2% in the past week and 26.2% over the last month.
Investors have been reacting to a mix of cautious solar industry sentiment, ongoing concerns about oversupply in key markets, and shifting expectations for policy support in the US and Europe. These factors have fueled large swings in solar stocks like SolarEdge. At the same time, headlines around grid modernization, energy storage adoption, and residential solar demand volatility are influencing how the market prices SolarEdge’s role in the transition to cleaner energy.
Against that backdrop, SolarEdge currently scores a 5/6 valuation check score, suggesting it appears undervalued on most of our metrics. Next, we will unpack what that means across different valuation approaches and then finish with a more structured way to think about its long-term value story.
SolarEdge Technologies delivered 131.0% returns over the last year. See how this stacks up to the rest of the Semiconductor industry.
A Discounted Cash Flow model estimates what a company is worth by projecting its future cash flows and discounting them back to today using a required rate of return. For SolarEdge Technologies, the 2 Stage Free Cash Flow to Equity model starts from last twelve months free cash flow of about $22.9 Million and then layers on analyst forecasts and longer term extrapolations.
Analysts expect free cash flow to climb into the low hundreds of Millions over the next several years, with Simply Wall St extending those projections further out. By 2029, free cash flow is projected to reach roughly $260 Million, and then continue growing at gradually slowing rates into the 2030s. All of those future cash flows are discounted back to today to arrive at an estimated intrinsic value of about $37.74 per share.
With the stock currently trading around $29, the DCF suggests SolarEdge is approximately 21.8% undervalued, indicating the market price may reflect a relatively pessimistic outlook compared with these cash flow assumptions.
Result: UNDERVALUED
Our Discounted Cash Flow (DCF) analysis suggests SolarEdge Technologies is undervalued by 21.8%. Track this in your watchlist or portfolio, or discover 907 more undervalued stocks based on cash flows.
SEDG Discounted Cash Flow as at Dec 2025
Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for SolarEdge Technologies.
For companies where current earnings are weak or volatile, the price to sales ratio is often a better gauge of value than price to earnings, because it focuses on the revenue base that future profits can be built on. Investors typically pay a higher or lower sales multiple depending on how quickly revenue is expected to grow and how risky that growth looks.
SolarEdge currently trades on a price to sales ratio of about 1.69x, which is well below both the Semiconductor industry average of around 5.47x and the peer average of roughly 3.18x. To go a step further, Simply Wall St calculates a proprietary Fair Ratio of 1.94x for SolarEdge. This Fair Ratio estimates what a reasonable price to sales multiple should be after weighing the company’s growth outlook, profitability potential, risk profile, industry positioning and market cap, making it more tailored than a simple comparison with peers or the broad industry.
Since SolarEdge’s actual 1.69x price to sales sits below the 1.94x Fair Ratio, the stock screens as undervalued on this measure.
Result: UNDERVALUED
NasdaqGS:SEDG PS Ratio as at Dec 2025
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Earlier we mentioned that there is an even better way to understand valuation. Let us introduce you to Narratives, a simple framework on Simply Wall St’s Community page. You can connect your story about SolarEdge Technologies to specific assumptions for future revenue, earnings and margins. These then flow into a financial forecast and finally a fair value that you can compare directly with today’s share price to decide whether to buy, hold, or sell. The platform dynamically updates those Narratives as new news or earnings arrive so your view stays current. Different investors can see, for example, one Narrative that leans into international expansion and partnerships to justify a fair value closer to the most optimistic targets around $35, and another far more cautious Narrative that focuses on U.S. policy risk and residential solar headwinds to support something nearer the bearish end around $7, all within an easy, approachable tool used by millions of investors.
Do you think there’s more to the story for SolarEdge Technologies? Head over to our Community to see what others are saying!
NasdaqGS:SEDG Community Fair Values as at Dec 2025
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include SEDG.
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