On Wednesday, Goldman Sachs updated its investment perspective on shares of SolarEdge Technologies (NASDAQ:SEDG), increasing the price target to $28 from the previous $27 while maintaining a Neutral rating on the stock. The adjustment follows SolarEdge's third-quarter 2024 performance and the announcement of a collaborative agreement with Novartis (SIX:NOVN), which involves research and expanded software utilization.
SolarEdge's shares experienced significant market outperformance on the day, with a notable 13.9% increase, in stark contrast to the broader market downturns of 2.9% in the XBI and a 0.3% dip in the S&P.
Although the company's operating results for the quarter were slightly below expectations, the management team expressed confidence in the forward outlook for the remainder of the year, particularly for the Software (ETR:SOWGn) business segment. They highlighted the resilience seen across large and mid-sized Annual Contract Value (ACV) accounts and an increase in depth of utilization.
The company is making consistent strides in broadening its Software-as-a-Service (SaaS) offerings. One example is the predictive toxicology initiative, a partnership with the Bill & Melinda Gates Foundation.
Meanwhile, SolarEdge continues to advance its proprietary pipeline with several milestones on the horizon. Initial Phase 1 data is anticipated in the fiscal year 2025 for multiple drug candidates targeting various cancers and solid tumors.
Management has also indicated the potential to progress an additional asset into clinical trials during 2025, with possible targets including EGFRC797S, PRMT5-MTA, and NLRP3. The overall sentiment from the management commentary was positive, reflecting on what was termed a solid quarter despite some operational shortfalls.
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