SolarEdge Stock Kicked the Week Off Strong. Why Today It's Having Its Worst Session in 14 Months.

SolarEdge stock started the week strong, reclaiming a key moving average on the back of strong gains Monday and Tuesday.

But then earnings arrived, putting the residential solar equipment company on pace for its worst day in 14 months.

SolarEdge stock sank 24% to $36.90 on Wednesday and was on pace for its largest daily percentage decline since June 17, 2025. Shares gained 9.5% and 8%, respectively Monday and Tuesday.

Those gains pushed the stock back above its 200-day moving average (around the $42.50 level). Prior to the big reversal Wednesday, it appeared that SolarEdge might be poised to move higher after seemingly bottoming at the end of July.

Other solar stocks also declined Wednesday. First Solar declined 2.3%, Enphase Energy dropped 3%, and Sunrun fell 2.9%. Nextpower gained 1.1%.

The declines in SolarEdge shares came as the company posted better-than-expected earnings and revenue gains of rose 20%, but issued third-quarter guidance that missed Wall Street forecasts.

SolarEdge forecasts third-quarter revenue between $310 million and $340 million with gross margin ranging from 22% to 26%. That disappointed Wall Street, which expects $368 million in revenue for the third quarter.

William Blair analyst Jed Dorsheimer wrote Wednesday that the third-quarter revenue guidance and gross margin midpoints represent misses of 12% and 2%, respectively, from Wall Street's expectations.

It's what was driving the share price sharply lower, according to Dorsheimer.

SolarEdge has risen 27% this year but is 90% below its record closing high of $368.33 from Nov. 15, 2021.

Solar companies have been dealing with the overhang of Section 232 -- the U.S. trade law provision that allows the government to investigate imports on grounds of national security.

Ongoing national security investigations and tariffs on imported raw materials -- such as steel, aluminum, and polysilicon -- have created severe pricing uncertainty, delayed projects, and complicated long-term procurement plans for many solar companies.

If the U.S. eases restrictions on imported polysilicon, a key material in solar panels, First Solar and other solar stocks could see significant upside.

The government decision on the investigation into imported polysilicon is expected sometime soon after getting pushed out from late June.