Looking for growth without the hefty price tag? Consider NASDAQ:ENPH.

Here's ENPHASE ENERGY INC (NASDAQ:ENPH) for you, a growth stock our stock screener believes is undervalued. NASDAQ:ENPH is scoring impressively in terms of growth while demonstrating strong financials. On top of that, it remains attractively priced. Let's break it down further.

Growth Examination for NASDAQ:ENPH

Every stock receives a Growth Rating from ChartMill, ranging from 0 to 10. This rating assesses various growth aspects, including historical and projected EPS and revenue growth. NASDAQ:ENPH boasts a 8 out of 10:

• The Earnings Per Share has grown by an impressive 39.84% over the past year.
• ENPH shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 69.42% yearly.
• The Revenue has grown by 34.38% in the past year. This is a very strong growth!
• Measured over the past years, ENPH shows a very strong growth in Revenue. The Revenue has been growing by 52.11% on average per year.
• ENPH is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.07% yearly.
• ENPH is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 12.15% yearly.

A Closer Look at Valuation for NASDAQ:ENPH

ChartMill assigns a Valuation Rating to each stock, ranging from 0 to 10. This rating is calculated by analyzing different valuation elements, such as price to earnings and free cash flow, both in absolute terms and relative to the market and industry. In the case of NASDAQ:ENPH, the assigned 5 reflects its valuation:

• Compared to the rest of the industry, the Price/Earnings ratio of ENPH indicates a somewhat cheap valuation: ENPH is cheaper than 76.19% of the companies listed in the same industry.
• ENPH is valuated rather cheaply when we compare the Price/Earnings ratio to 25.84, which is the current average of the S&P500 Index.
• 63.81% of the companies in the same industry are more expensive than ENPH, based on the Price/Forward Earnings ratio.
• 68.57% of the companies in the same industry are more expensive than ENPH, based on the Enterprise Value to EBITDA ratio.
• Based on the Price/Free Cash Flow ratio, ENPH is valued cheaper than 88.57% of the companies in the same industry.
• The excellent profitability rating of ENPH may justify a higher PE ratio.

Evaluating Health: NASDAQ:ENPH

Every stock is evaluated by ChartMill, receiving a Health Rating on a scale of 0 to 10. This assessment considers different health aspects, including liquidity and solvency, both in absolute terms and relative to industry peers. NASDAQ:ENPH has achieved a 6 out of 10:

• ENPH has an Altman-Z score of 5.34. This indicates that ENPH is financially healthy and has little risk of bankruptcy at the moment.
• The Debt to FCF ratio of ENPH is 1.60, which is an excellent value as it means it would take ENPH, only 1.60 years of fcf income to pay off all of its debts.
• The Debt to FCF ratio of ENPH (1.60) is better than 67.62% of its industry peers.
• Although ENPH does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
• A Current Ratio of 3.36 indicates that ENPH has no problem at all paying its short term obligations.
• ENPH has a Quick Ratio of 3.13. This indicates that ENPH is financially healthy and has no problem in meeting its short term obligations.
• ENPH has a Quick ratio of 3.13. This is in the better half of the industry: ENPH outperforms 63.81% of its industry peers.

Assessing Profitability for NASDAQ:ENPH

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NASDAQ:ENPH, the assigned 8 is noteworthy for profitability:

• Looking at the Return On Assets, with a value of 16.09%, ENPH belongs to the top of the industry, outperforming 81.90% of the companies in the same industry.
• Looking at the Return On Equity, with a value of 56.36%, ENPH belongs to the top of the industry, outperforming 95.24% of the companies in the same industry.
• Looking at the Return On Invested Capital, with a value of 19.47%, ENPH belongs to the top of the industry, outperforming 84.76% of the companies in the same industry.
• ENPH had an Average Return On Invested Capital over the past 3 years of 17.57%. This is significantly above the industry average of 12.25%.
• The 3 year average ROIC (17.57%) for ENPH is below the current ROIC(19.47%), indicating increased profibility in the last year.
• With a decent Profit Margin value of 21.08%, ENPH is doing good in the industry, outperforming 75.24% of the companies in the same industry.
• With a decent Operating Margin value of 22.70%, ENPH is doing good in the industry, outperforming 75.24% of the companies in the same industry.
• ENPH's Operating Margin has improved in the last couple of years.
• ENPH's Gross Margin has improved in the last couple of years.

Our Affordable Growth screener lists more Affordable Growth stocks and is updated daily.

Our latest full fundamental report of ENPH contains the most current fundamental analsysis.

Keep in mind

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.