Is ENPH a high-quality business?

AlphaMadera's AlphaQuality grade scores Enphase Energy, Inc. on six pillars — profitability, capital efficiency, balance-sheet strength, growth durability, cash generation, and shareholder yield. The composite letter grade reflects how ENPH compares to a Buffett-style quality bar.

What is Enphase Energy, Inc.'s AlphaQuality grade?

AlphaQuality assigns a letter grade (A through F) to ENPH based on a six-pillar quantitative model. The live page shows the composite grade plus each pillar's individual score with the underlying metrics.

What makes ENPH a quality stock?

AlphaQuality looks at return on capital, free-cash-flow margins, debt-to-equity, revenue stability, dividend and buyback policy, and operating-margin trend. Stocks scoring well across all six pillars earn higher grades — the methodology favors compounders over cyclicals.

ENPH - Enphase Energy, Inc.

Price: -- -- | CONSENSUS: Hold DETAILS | PRICE TARGET: $45.65 DETAILS

AlphaQuality

Quantitative six-pillar business-quality grade

Other Commodity Producers

AlphaQuality — archetype-weighted quantitative grade

B 73.6 / 100 composite

Composite Grade

Composite of six pillars weighted for other commodity producers businesses. Purely quantitative — no stock price or analyst input.

Profitability

Weight: 15%

C- 44.6

5yr Avg ROIC 10.7% 64/100
Operating Margin Trend -2.23 pp/yr 0/100

Capital Efficiency

Weight: 10%

A 92.2

5yr Avg ROE 23.1% 97/100
5yr Share-Count CAGR -1.4% 83/100

Growth Quality

Weight: 5%

C- 48.1

5yr Revenue CAGR 1.6% 33/100
5yr EPS CAGR 6.0% 60/100
Revenue-Growth Years (5) 3/5 60/100

Cash Generation

Weight: 25%

A 87.2

5yr FCF Margin 24.0% 94/100
5yr FCF/NI Conversion 2.08x 79/100

Balance Sheet

Weight: 25%

A+ 98.1

Net Debt / EBITDA -0.93x 100/100
Interest Coverage (EBIT/Int) 46.30x 100/100
Altman Z-Score 3.86 93/100

Stability

Weight: 20%

C- 45.2

EPS Volatility (σ/μ) 0.59 23/100
Piotroski F-Score 6 67/100
Negative-Revenue Years (5) 2/5 60/100

3 of 5 gurus held; 1 added; 2 trimmed; 2 full exits.

Holders: 3 -2
Avg Δ position: -22.3%
New buys: 0
Full exits: 2

Soros sold -100%
Laffont sold -100%
Dalio decreased -79%

How this is calculated

AlphaQuality grades six pillars from 0-100 and weights each by archetype:

Profitability (15%) — 5yr Avg ROIC, Operating Margin Trend
Capital Efficiency (10%) — 5yr Avg ROE, 5yr Share-Count CAGR
Growth Quality (5%) — 5yr Revenue CAGR, 5yr EPS CAGR, Revenue-Growth Years (5)
Cash Generation (25%) — 5yr FCF Margin, 5yr FCF/NI Conversion
Balance Sheet (25%) — Net Debt / EBITDA, Interest Coverage (EBIT/Int), Altman Z-Score
Stability (20%) — EPS Volatility (σ/μ), Piotroski F-Score, Negative-Revenue Years (5)

We deliberately ignore stock price, analyst targets, and consensus ratings so the grade is suitable for backtesting forward returns. A minimum of 5 fiscal years of audited statements is required; distressed and highly leveraged infrastructure businesses are declared ungradable rather than forced into a numeric score.