SEDGCAUTIOUS

SEDG Gross Margin Analysis

22.0%

Higher than 26% of Energy sector peers

Updated 622h ago·SEC filings & market data

Key Takeaway

Gross margin measures the percentage of revenue a company keeps after paying the direct costs of producing its goods, so SolarEdge’s 22.0% means it retains $0.22 of every dollar in sales after covering production expenses.

Sector Performance

26th percentile

SEDG

22.0%

Sector Median

32.4%

Sector Avg

39.3%

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Deep Analysis

This is below the energy sector median of 32.4%, placing the company in the 24th percentile among its peers—meaning 76% of sector competitors have a higher gross margin. The trend data for this metric is not available, with year-over-year and quarter-over-quarter changes both reported as N/A, so no directional movement can be assessed. The combination of a low gross margin relative to the sector and the absence of trend information suggests limited visibility into whether the margin is improving or deteriorating, which introduces uncertainty about cost control and pricing power. This metric does not directly contradict the overall NEUTRAL verdict, but the below-median profitability dynamic reinforces a cautious stance rather than a bullish or bearish one.

Frequently Asked Questions

What does the Gross Margin tell investors about SEDG?

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.

How is the Gross Margin calculated?

Gross Margin is calculated as: Gross Profit / Revenue.

How does SEDG's Gross Margin compare to its sector?

SEDG's Gross Margin of 22.0% compares to a Energy sector median of 32.4%, placing it in the 26th percentile.

Who are SEDG's closest peers by Gross Margin?

The closest Energy peers by Gross Margin include: NOG (32.9%), CVE (31.8%), LNG (31.7%), PXD (34.2%), RUN (30.4%).

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Learn More About Gross Margin

Gross Margin vs Net Margin: Why the Gap Between Them Tells You Everything

Gross margin vs net margin: learn what the spread between them reveals about operating leverage, cost structure, and early warning signs in any stock.

The Formula

Gross Profit / Revenue

Why It Matters

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.