SolarEdge Technologies Inc. (NASDAQ:SEDG)

Debt to Equity Ratio

The debt to equity ratio data is incomplete for the initial quarters but becomes available from the December 31, 2019 period onwards. Starting at 0.55 in December 2019, the ratio remained relatively stable around the mid-0.5 range through mid-2021. From the second quarter of 2022, a noticeable downward trend is observed, decreasing from 0.34 to 0.31 by the end of 2022. This suggests a gradual reduction in the company's reliance on debt relative to equity in the most recent periods.

Debt to Equity Ratio (Including Operating Lease Liability)

This ratio remained stable at a very low level (around 0.03 to 0.04) from the first quarter of 2019 up to mid-2020. Thereafter, it increased sharply to approximately 0.58 in the third quarter of 2020 and remained elevated until mid-2021. Following this peak, the ratio declined steadily through 2022, settling at 0.33 by the end of that year. This pattern implies that operating lease liabilities had an increasing impact on debt metrics mid-period, which has lessened in recent quarters.

Debt to Capital Ratio

Data for this ratio is presented starting from December 2019 with a value of 0.36. The ratio exhibited marginal fluctuations but generally remained close to the 0.34–0.37 range through mid-2021. From the third quarter of 2021 onward, a decline is evident, with the ratio falling to 0.24 by the end of 2022. This indicates a shrinking proportion of debt financing relative to total capital over the recent reporting periods.

Debt to Capital Ratio (Including Operating Lease Liability)

This ratio stayed constant at around 0.03 to 0.04 until mid-2020, followed by a sharp increase to approximately 0.37 in the second half of 2020. Elevated values persisted until mid-2021, after which the ratio gradually decreased to 0.25 by the end of 2022. This trajectory mirrors the trend seen in debt to equity including operating leases, highlighting the significant but temporary impact of operating leases on overall capital structure.

Debt to Assets Ratio

Reported data starts at 0.25 in December 2019, with the ratio maintaining a fairly steady level between 0.23 and 0.26 through mid-2021. From the third quarter of 2021, a decreasing trend is observed, with the ratio falling to 0.16 by the conclusion of 2022. The decline indicates a reduced proportion of debt relative to total assets over time, signifying strengthening asset coverage or reduced leverage.

Debt to Assets Ratio (Including Operating Lease Liability)

The ratio was stable at low levels (around 0.02) until mid-2020, jumped to approximately 0.26–0.27 from the second half of 2020 through mid-2021, and subsequently declined steadily to 0.17 by the end of 2022. This pattern again reflects the temporary influence of operating lease liabilities increasing debt measures before a more recent reduction.

Financial Leverage

Financial leverage began at 1.88 in the first quarter of 2019, followed by a slight decline through the first half of 2020. A marked increase to about 2.21–2.24 occurred in the latter half of 2020 and remained relatively stable through the end of 2021. In 2022, financial leverage decreased somewhat, ending the year near 1.96. The increase in leverage late 2020 suggests higher total asset to equity ratios during that period, with a modest reversal observed more recently.

Total Debt

Total debt figures first appear in the quarter ending December 31, 2020, starting at approximately $570 million. From that point onward, total debt shows a gradual increase, reaching a peak of about $670 million by the quarter ending June 30, 2022, and then remaining relatively stable through December 31, 2022. The trend suggests the company maintained a consistent level of outstanding debt over the most recent periods, with a slight upward movement before stabilizing.

Total Stockholders’ Equity

Stockholders’ equity demonstrates a steady upward trajectory throughout the entire period. Starting at approximately $626 million as of March 31, 2019, equity increased consistently every quarter, reaching over $2 billion by March 31, 2022. This substantial growth persisted through the end of 2022, with equity exceeding $2.1 billion by December 31, 2022. The progression indicates strong capital accumulation and reinvestment, reflecting ongoing company value enhancement and equity financing.

Debt to Equity Ratio

The debt to equity ratio is available from December 31, 2020 onwards and remains below 0.6 across all quarters reported. Initially, the ratio is around 0.55, rising slightly to approximately 0.59 in September 2021. Subsequently, there is a consistent decline through the end of 2022, reaching approximately 0.31 by December 31, 2022. This downward trend suggests a gradual reduction in financial leverage relative to equity, implying an improvement in the company’s capital structure stability and potentially lower financial risk.

Overall Financial Position

The data reflects a company experiencing significant equity growth alongside moderately increasing but stabilizing debt levels. The declining debt to equity ratio further supports the interpretation of a strengthening balance sheet with an emphasis on growing equity capital relative to liabilities. These trends collectively signal enhanced financial health and improved solvency over the examined timeframe.

The financial data indicates several notable trends in the company's capital structure over the analyzed quarters.

Total Debt (including operating lease liability)

The total debt remained relatively stable and low from March 2019 through June 2020, fluctuating around the 25,000 to 30,000 thousand US dollar range. However, starting in September 2020, there was a significant and abrupt increase, reaching approximately 600,000 thousand US dollars and continuing to rise slightly through December 2020. From March 2021 onward, total debt remained elevated between approximately 675,000 and 725,000 thousand US dollars, with minor fluctuations but no substantial reduction through the end of 2022. This sharp rise suggests a major financing event or acquisition of liabilities occurred around mid-2020.

Total Stockholders’ Equity

Equity showed a consistent upward trend throughout the entire period. Beginning at approximately 626,000 thousand US dollars in early 2019, equity increased steadily each quarter, surpassing 1,000,000 thousand US dollars by late 2020. There was a marked acceleration in equity growth from March 2022 onwards, reaching over 2,170,000 thousand US dollars by December 2022. This substantial increase in equity capital indicates strong retention of earnings, successful capital raises, or other equity-enhancing activities during this period.

Debt to Equity Ratio

The debt to equity ratio was minimal and stable at around 0.03 to 0.04 through mid-2020, consistent with the low levels of debt and growing equity. Following the surge in debt in late 2020, the ratio spiked to approximately 0.58 and remained near this elevated level through most of 2021. However, starting in early 2022, the ratio began to decline steadily, falling to around 0.33 by the end of 2022. This decrease is driven by a combination of stable-to-reducing debt levels alongside a rapid increase in equity, implying an improvement in the company’s leverage position and a more solid capital base.

Overall, the data reflects a company that underwent a major increase in debt obligations beginning in late 2020, possibly related to strategic investments or restructuring. Despite this, equity growth was robust and outpaced debt increases over time, leading to a gradual deleveraging trend beginning in 2022. The lowering debt-to-equity ratio in the latter periods suggests a strengthening financial position with enhanced equity cushion relative to liabilities.

The financial data reveals several key trends related to the company’s capital structure and debt levels over recent quarters.

Total Debt

The company’s total debt figures are only available starting from the quarter ending December 31, 2020. From that period onward, total debt has remained relatively stable, fluctuating slightly around the $570 million to $670 million range. There is a gradual increase noted from $570 million at the end of 2020 to a peak of approximately $675 million in the third quarter of 2022, followed by a minor decrease to roughly $670 million by the end of 2022.

Total Capital

Total capital has shown consistent growth throughout the entire observed period from March 31, 2019, to December 31, 2022. Starting at approximately $626 million in early 2019, the total capital steadily rises each quarter, with a significant acceleration seen from June 30, 2020, where it jumps markedly from around $924 million to $1.6 billion by September 30, 2020. This upward trend continues to nearly $2.85 billion by the end of 2022.

Debt to Capital Ratio

The debt to capital ratio is available from the quarter ending December 31, 2020, onward and displays a downward trend. Initially near 0.36, this ratio declines gradually to about 0.24 by the end of 2022. This suggests that while total debt has stayed roughly constant, the company has been increasing its capital base, thus reducing its leverage over time.

Overall, the data indicates a strategic reduction in leverage through significant increases in total capital, while maintaining stable debt levels. This results in improved capital structure metrics, reflecting potentially stronger financial stability and a conservative approach to debt management in recent years.

The analysis of the quarterly financial data reveals significant changes in the company’s leverage and capital structure over the observed periods.

Total Debt (including operating lease liability)

From March 2019 through June 2020, the total debt remained relatively stable, ranging roughly between $24.8 million and $30 million. However, starting in September 2020, total debt increased sharply, leaping from approximately $30 million to nearly $600 million. This elevated debt level persisted through to the end of 2022, with only minor fluctuations in the $700 million range.

Total Capital (including operating lease liability)

Total capital showed steady growth from March 2019 to June 2020, rising from about $651 million to $955 million. Similar to the trend in debt, there was a substantial increase beginning in September 2020, with total capital nearly doubling to approximately $1.63 billion. This upward trend continued through 2021 and into 2022, reaching close to $2.9 billion by December 2022.

Debt to Capital Ratio (including operating lease liability)

The debt to capital ratio was consistently low and stable at approximately 0.03 to 0.04 from March 2019 until June 2020, indicating minimal leverage relative to total capital. Starting September 2020, the ratio increased sharply to around 0.37, reflecting the substantial rise in debt levels relative to capital. Despite the growth in both debt and capital, the ratio experienced a slight declining trend from 0.38 in March 2021 to about 0.25 by December 2022, suggesting that capital growth outpaced debt increases toward the end of the period.

In summary, the company underwent a notable shift in financial structure around the third quarter of 2020, marked by a pronounced increase in debt and capital. Initially, there was a sharp rise in leverage as indicated by the debt to capital ratio. Subsequently, the company expanded its capital base more significantly than debt, leading to a gradual reduction in leverage ratio through 2022. This pattern suggests strategic debt financing followed by capital strengthening to support growth or investment activities.

Total Debt

The total debt was first reported in the fourth quarter of 2020 and has exhibited a generally increasing trend since then. Starting at approximately $570 million, the debt gradually rose each quarter, reaching about $670 million by the end of 2022. Despite minor fluctuations, the overall level of debt remained relatively stable towards the end of the period under review.

Total Assets

Total assets demonstrated consistent growth over the entire period. Beginning at approximately $1.18 billion in the first quarter of 2019, assets increased steadily each quarter. Notably, there was a significant rise between mid-2020 and the end of 2022, where assets expanded from roughly $1.6 billion to over $4.2 billion, indicating accelerated asset accumulation in the latter part of the period.

Debt to Assets Ratio

The debt to assets ratio was first available in the fourth quarter of 2020. Initially, the ratio was around 0.25, and it remained relatively stable through 2021. However, starting in 2022, the ratio showed a clear downward trend, decreasing from 0.24 to 0.16 by the end of 2022. This decline suggests an improvement in the company’s leverage position, with assets growing at a faster pace than debt, resulting in reduced relative indebtedness.

Summary

The financial data reflects a period of substantial asset growth alongside a modest increase in absolute debt levels. The company has managed to reduce its leverage ratio significantly in recent quarters, strengthening its balance sheet. These trends suggest a strategic focus on expanding asset base while controlling debt growth, contributing to a more robust financial position.

Total Debt

The total debt, including operating lease liabilities, showed a relatively stable level between March 2019 and June 2020, fluctuating modestly around the 25,000 to 30,000 thousand US dollar range. However, starting from September 2020, there was a sharp and significant increase in total debt, jumping to nearly 600,000 thousand US dollars, and slightly rising thereafter to around 716,000 thousand US dollars by December 2022. This indicates a substantial rise in leverage or financing activities during this period.

Total Assets

Total assets exhibited consistent growth throughout the entire period from March 2019 to December 2022. Beginning at approximately 1,176,923 thousand US dollars in early 2019, the assets increased steadily, surpassing 2,400,000 thousand US dollars by late 2020, and continuing to increase to over 4,265,949 thousand US dollars by the end of 2022. The growth in assets reflects an expansion in the company's resource base over time.

Debt to Assets Ratio

The debt-to-assets ratio was stable and very low at around 0.02 in the first half of the observed period, indicating low leverage relative to asset size. However, there was a marked increase starting from mid-2020, peaking around 0.27 in late 2020 and early 2021, corresponding with the significant increase in total debt. Following this peak, the ratio showed a gradual decline from 0.24 in late 2021 to 0.17 by the end of 2022. Despite the reduction, the leverage ratio remains higher than the initial pre-2020 levels, suggesting a maintained higher level of debt relative to assets than previously observed.

The analysis of the quarterly financial data reveals notable trends in the company's asset base, equity position, and financial leverage over the examined periods.

Total assets

Total assets demonstrated consistent growth throughout the period from March 31, 2019, to December 31, 2022. The asset base increased from approximately $1.18 billion to over $4.26 billion, reflecting a more than threefold expansion. This upward trajectory indicates ongoing investment and expansion efforts within the company, with particularly accelerated growth occurring after March 31, 2022.

Total stockholders’ equity

The equity position also grew steadily, rising from around $626 million to approximately $2.18 billion during the same timeframe. This progression suggests enhanced company value and retained earnings accumulation. The equity growth trend aligns with asset growth, albeit at a somewhat slower pace, indicating that the company may be leveraging external financing sources in addition to internal capital generation.

Financial leverage

Financial leverage, expressed as a ratio, fluctuated during the observation period. It started at 1.88 in early 2019 and exhibited a general decline to about 1.74 by mid-2020. However, a marked increase is observed in the latter half of 2020, peaking at approximately 2.24 by the end of 2020 and remaining elevated through 2021. Subsequently, the leverage ratio decreased again to around 1.83 by March 2022, before modestly rising to nearly 1.96 by December 2022. These fluctuations indicate periods of varying reliance on debt relative to equity, with increased leverage suggesting greater borrowing during late 2020 and 2021, followed by a partial deleveraging phase in 2022.