Early Tuesday trading saw a decline in Enphase Energy Inc.’s stock after the manufacturer of solar-power inverters received a downgrade from analysts following President Donald Trump’s decision to eliminate clean-electricity tax incentives sooner than anticipated.
Shares of electricity-generating firms exposed to the wind and solar markets also declined, as did other solar-power stocks.
Late Monday, Trump issued an executive order that mandated the termination of clean-electricity tax incentives within 45 days of the Republican megabill’s implementation, which he signed into law last week. This is anticipated to occur prior to the year’s end.
First Solar Inc.’s stock (FSLR) plummeted 4.1%, putting it in negative territory for the year, while Enphase Energy’s stock (ENPH) fell 4.2%. Among the constituents of the S&P 500 SPX, both businesses have experienced some of the worst declines.
Shares of SunRun Inc. (RUN) and SolarEdge Technologies Inc. (SEDG) fell 10.6% and 4.2%, respectively, among other solar companies.
TD Cowen lowered its price objective for Enphase’s stock from $58 to $45 and downgraded its rating from buy to hold.
In a research note published Tuesday, Jeff Osborne, an analyst at TD Cowen, stated that “the removal of [the tax credit] at the end of 2025 will negatively impact U.S. customer-owned [residential] solar demand, which is currently challenged due to elevated interest rates.”
He stated that approximately 75% of Enphase’s revenue comes from the U.S. market and that the company’s solar-power-inverter business is exposed to the customer-owned market segment rather than customers who lease their solar-power equipment.
“We see demand for inverters to begin to deteriorate in [the fourth quarter of 2025], given distributor inventory and building permit timing, though there may be a pull-forward of demand to lock in the tax credit by the end of 2025,” Osborne stated.
Trump said that since Enphase sources its battery cells from China, his tariffs may also have a negative impact on the company’s earnings.
“The company plans to qualify sources outside of China early next year, as tariffs are expected to weigh on margins in the near term,” he stated.
Trump stated in his executive order that he opposes the subsidization of “expensive and unreliable energy sources” like wind and solar.
“The proliferation of these projects displaces affordable, reliable, dispatchable domestic energy sources, compromises our electric grid, and denigrates the beauty of our Nation’s natural landscape,” Trump stated.
Meanwhile, equities from power-generation corporations with wind and solar portfolios also declined. NRG Energy Inc. (NRG) down 4.9%, NextEra Energy Inc. (NEE) retreated 3.8%, and AES Corp. (AES) fell 3.3%.
The stock of Enphase Energy had dropped 38.2% in 2025 as of Monday’s closing bell, First Solar had managed to hold onto a 0.5% gain for the year, SunRun had gained 20.1%, and SolarEdge had soared 94.3%.
