Enphase Energy Leads Solar Stocks Rally with Over 100% Surge in May
Solar energy stocks have delivered their most impressive monthly performance since 2013. The Invesco Solar ETF surged by an estimated 26.5% in May 2026. The rally was led by Enphase Energy whose stock skyrocketed by over 110% during the month. Concurrently, competitor SolarEdge Technologies also saw a significant increase, jumping nearly 79%. This marks a dramatic turnaround for the residential solar sector.
The rally was fueled by several catalysts. One notable event was CEO Badrinarayanan Kothandaraman’s $337,481 insider stock purchase on May 26. Executed near the stock’s 52-week high, the purchase involved 5,000 shares at prices ranging from $67.37 to $68.39. This signaled strong management confidence. During the rally, Enphase shares reached a fresh 52-week high of $72.21.
Wall Street analysts responded with enthusiasm. Roth Capital raised its price target to $85 from $55 while maintaining a Buy rating. Goldman Sachs also increased its target to $57 from $51. This highlighted Enphase’s development of solid-state transformers for AI data centers. The residential solar trade has been gaining traction since mid-May, supported by favorable financing conditions as the 10-year Treasury yield remained relatively stable around 4.46%.
Despite the positive momentum, the sector faces some challenges. Enphase’s first-quarter 2026 earnings showed a 20.6% year-over-year revenue decline to $282.9 million. Operating margins also turned negative at -10.5%. Despite these headwinds, investors are betting on a recovery driven by upcoming tax credit deadlines and renewed demand for residential solar installations as homeowners seek energy independence.
Source: CNBC