Enphase Energy has rallied another 43% this week to $66.90, leaving every major analyst target in the dust — and yet the bears refuse to cover.
Short interest is the dominant tension here. At 24.2% of free float, the position is not just large — it has grown. Bears added roughly 18% more exposure over the past month, and the week saw only a marginal 0.4% uptick in shares short. That is a remarkable posture for a stock up 87% in a month. The previous note filed on May 20 flagged shorts holding firm through a 25% weekly surge; since then the stock has added another 43% and the short position remains essentially unmoved. At 31.7 million shares short with a next earnings date of July 28, this is a substantial bet that the rally is disconnected from fundamentals.
What makes the short conviction even more striking is that borrow conditions impose almost no pressure to unwind. Availability is running at 219% — more than two shares available to lend for every one already borrowed — which is well within the normal range and up from the year's tightest reading of 166% logged on May 8. Cost to borrow is just 0.50%, barely above last week's level and nowhere near the kind of financing cost that forces involuntary covering. The lending market is offering bears a comfortable seat. Options confirm the same read: the put/call ratio at 0.72 is actually slightly below its 20-day average of 0.75, sitting about one standard deviation on the bullish side. Calls are dominating, consistent with the momentum trade, but not at a level that screams excessive euphoria.
The Street is now firmly behind the curve. The consensus mean target is $41.71 — the stock closed at $66.90. Goldman Sachs raised its target to $57 just last week and it is already 15% below market. Barclays, running an Underweight with a $30 target, is nearly 55% below the current price. The post-earnings wave of cuts from JP Morgan, Citi, Susquehanna, Wells Fargo, and TD Cowen — all maintaining ratings while trimming to the low-to-mid $30s — now look steeply stale. The EV/EBITDA multiple has expanded to 26x, up roughly 11% over the past month, and the P/E has re-rated to 30x from around 15x just 30 days ago. Factor scores offer little comfort to bulls paying this price: EPS momentum ranks in the bottom quintile on both 30-day and 90-day measures (15th and 20th percentile respectively), and EPS surprise is at the 8th percentile. The 12-month forward EPS growth estimate, however, ranks at the 94th percentile — the one forward-looking data point that could justify paying ahead.
The most noteworthy near-term insider development cuts the other way. CEO Badrinarayanan Kothandaraman bought 5,000 shares at roughly $67–68 on May 26 — a combined $337,000. It is not a transformative position relative to his existing stake, but buying in the open market at a 52-week+ high, the same day the stock trades well through every published price target on the Street, is a clear signal of confidence. The 90-day net insider position is a positive 211,789 shares, worth roughly $9.3 million, though that figure is dominated by the March sell from director Thurman Rodgers ($6M) and the CEO's fresh purchases. SEDG, the closest US peer, rose 28% this week and 14% on Tuesday alone — so the rally in ENPH is happening in a sector context, not in isolation.
The next earnings print on July 28 is the clearest near-term reference point. The April 28 release produced an 11.5% single-day drop before recovering to a +2.2% move over five days — a pattern where the initial reaction punished expectations and a subsequent recovery rewarded patience. With the stock now 43% higher than where it was on that print date, how shorts behave into the Q2 report — whether they press further or begin to trim into the remaining lending availability — will define whether the current standoff remains or breaks.
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