Jim Cramer Discussed These 11 Stocks Recently

7. Enphase Energy, Inc. (NASDAQ:ENPH)

Number of Hedge Fund Holders: 38

Cramer, while discussing people’s tendency to stick to their investment thesis because of confirmation bias, explained how solar stocks like Enphase Energy, Inc. (NASDAQ:ENPH) rose for 2 years but suffered when the public realized their cost and the interest rate environment.

“The residential solar stocks soared in 2020 and 2021 and kept running into 2022 even when most growth plays were getting pulverized. If you owned it, maybe you thought you were winning because people were embracing renewable energy and the government was subsidizing it heavily. But in 2023, the residential solar stocks, they, they got obliterated. Why?

Do you know that it had nothing to do with the popularity of renewable energy and it couldn’t be stopped by generous federal subsidies? Instead, it turned out that people can’t really afford residential solar systems without borrowing money. Meaning the whole industry was actually built not on solar but on financing. And once people realized long-term interest rates would remain elevated for quite some time, the residential solar stocks, they all got crushed. It’s not a coincidence, something like Enphase was roaring in 2020 and 2021 when people could borrow money for next to nothing.”

Enphase (NASDAQ:ENPH) is a company specializing in the design, development, production, and sale of energy solutions, with a focus on the solar photovoltaic industry.