MILPITAS, California, August 26, 2026, 11:06 (EDT) – SolarEdge Technologies (SEDG.O) shares climbed 7.7% after UBS said the new FCC inverter regulation could strengthen the company’s pricing power.
- SolarEdge shares climbed 7.66% to $32.17 in Wednesday trading.
- UBS boosted its rating on the stock to Buy and lifted the price target to $42.
- The action increased equity value by approximately $141 million.
- Gross margin for the second quarter was 27.5%, an increase of 16.4 points from a year earlier.
Shares in SolarEdge Technologies climbed 7.66% on Wednesday after UBS upgraded the inverter manufacturer to Buy. UBS also increased its price target to $42 from $36, pointing to a tightening supply of inverters in the U.S. UBS upgrade.
The stock changed hands at $32.17 as of 11:06 a.m. EDT, giving the company a market capitalization of $1.98 billion Google Finance. The $2.29 increase contributed about $141 million in value across a total of 61.53 million outstanding shares.
UBS linked its forecast to U.S. curbs on recently launched foreign-made inverter models. The bank anticipates limited supply will underpin SolarEdge’s market position and prices. It additionally increased its adjusted EBITDA projections for 2027 and 2028.
| Metric | Q2 2026 | Q1 2026 | Q2 2025 |
|---|---|---|---|
| Revenue | $346.2m | $310.5m | $289.4m |
| GAAP gross margin | 27.5% | 22.0% | 11.1% |
| GAAP operating loss | $16.0m | $55.0m | $115.5m |
| Non-GAAP operating income | $10.2m | -$24.8m | -$48.3m |
| Free cash flow | $3.1m | $20.7m | -$9.1m |
The call takes place amid a clear recovery. Revenue for the second quarter increased by 19.6% to $346.2 million. GAAP gross margin widened to 27.5%, up from 11.1% in the previous year company results.
SolarEdge reported adjusted operating income of $10.2 million, after recording a $48.3 million loss on the same metric a year ago. The company’s GAAP operating loss decreased by $99.5 million.
The regulatory bridge is significant as U.S. commercial demand compensates for softness in the residential sector. Chief Executive Shuki Nir said growth was supported by robust U.S. commercial and industrial performance. A reduced pool of eligible suppliers may further bolster that channel.
UBS has set a price target of $42, suggesting a 30.6% gain from $32.17. Achieving this would boost Wednesday’s market capitalization by approximately $605 million. Overall, analysts continue to be cautious.
Out of 16 recent analyst ratings followed by Google Finance, two analysts gave Buy ratings. Ten recommended Hold, while four issued Sell ratings. The consensus target price was $35.13, reflecting an upside of just 9.2%.
Short-term outlook also weighs on the case. SolarEdge projects third-quarter revenue between $310 million and $340 million, with the midpoint 6.1% lower than second-quarter revenue.
Management forecast an adjusted gross margin between 22% and 26%, not accounting for possible tariff refunds. In July, the company secured $11.5 million in IEEPA refunds.
Risks: The FCC restriction might not lead to sustained pricing leverage. Demand for U.S. residential solar continues to be weak. SolarEdge remains unprofitable on a GAAP basis, and changes in policy, tariffs or rival domestic supply could affect the advantage.
