The solar sector has been heating up since this summer and Enphase Energy has been on my watchlist for a potential breakout. Over the last few weeks, ENPH has been acting really well as it formed the right side of its' base. It broke out today with heavy volume coming in which is a great sign of institutional demand.
Enphase has many of the characteristics of a big winning stock. First and foremost, it has a history of delivering strong earnings, especially in its' last two quarters when earnings grew by over 100%. Moreover, sales growth has been accelerating-another attribute of a potential leader. Finally, ENPH is in the solar sector which is currently in the top ten of IBD groups. This makes sense as rising energy costs make switching to solar an attractive option for many consumers.
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Full Disclosure: I currently own ENPH.
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