ENPH is a technology company that specializes in supplying microinverter based solar and battery systems. It is expected to grow revenue by 25% a year for the next 3 years and earnings climbing to $5 a share next year. Even with the rapid growth the stock is trading at 13 x sales, and 60 x earnings for next year. Valuation wise it makes no sense to invest in the company as it is expected to have negative returns for the next few years, fair value stands around $200 per share.

Technicals look great however with the stock showing impressive strength and is up some 60% for the year while the market is down 18%. Traders can wait for a technical breakout above 305 for a potential target to 400 with a stop just below 270 which provides a 1:3 risk reward ratio.