Daniel Loeb (Trades, Portfolio) of Third Point LLC increased his position in Enphase Energy Inc. (ENPH, Financial) by 7.33% on Sept. 28.
Loeb founded Third Point LLC in 1995 and serves as CEO and portfolio manager. Loeb and his firm are activist investors, meaning they take an active position in a company and pressure management for change. They follow an event-driven, value-oriented investment style.
Loeb purchased 457,785 Enphase shares for $1.19 per share. The transaction had an impact of 0.01% on the portfolio. He now owns 6,706,772 shares.
Enphase designs and manufactures micro solar inverters, called microinverters, and software for the solar industry. The company was founded in 2006 and is headquartered in Petaluma, California.
Enphase has a market cap of $55.6 million with an enterprise value of $59.8 million. It has a price-book (P/B) ratio of 4.45 and a price-sales (P/S) ratio of 0.18.
GuruFocus ranked the company’s financial strength 4 of 10. Its low F-Score of 2 indicates the company has a poor financial condition. Similarly, the low Altman Z-Score of -0.62 ranks in the distress zone, meaning the company is at risk of bankruptcy in the near future. The cash-debt ratio of 0.6 is well below the industry median of 1.6.
GuruFocus ranked Enphase’s profitability and growth 1 of 10. It has an operating margin of -15.5% and a net margin of -16.3%. The company’s return on equity (ROE) of -139.8% ranks below 97% of companies in the global semiconductor equipment and materials industry. Enphase’s return on assets (ROA) of -30.14% ranks below 94% of companies in the industry. Its return on capital (ROC) of -66.5% ranks below 91% of competitors.
Loeb is the only investor in Enphase among the gurus with 14.35% of outstanding shares, which is 0.08% of his total assets managed. His firm is the company’s largest shareholder.
Enphase is one of two semiconductor stocks Loeb holds. Broadcom Ltd. (AVGO, Financial) is the other.
The DCF Calculator gives Enphase stock a fair value of $-11.88; it was trading at $1.22 on Tuesday.
Disclosure: I do not own stock in any companies mentioned in the article.
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