Several years ago I invested in and profited from an Israeli solar company that went on to become a ten bagger. Unfortunately I didn’t stay for the full ride but it was an interesting learning experience about how technologies in the solar energy ecosystem can sometimes prove to be significantly more profitable that the usual suspects of solar panel manufacturers and installers. The company was SolarEdge Technologies (SEDG) and they make inverters that are used to convert direct current (DC) generated from solar panels to alternating current (AC) that can be used by an electric grid or a household.
Demand for residential solar installation is up significantly in recent years due to federal incentives as well as state mandated standards such as California’s requirement that every new single family home and certain multifamily properties have to install a solar electric system starting in January 2020. However the biggest gains both in terms of efficiency and costs have been on the utility scale solar projects. Thin-film solar cells have seen their efficiency increase from just 8% in 1980 to over 23% this year.
This has helped utility scale solar projects achieve cost parity with fossil fuels and in some cases they are cheaper than fossil fuel powered projects. FTC Solar (FTCI) is a company that uses patented methods and software to tilt panels to capture energy from the sun as it traverses the sky during the day.
Last week we saw a string of insider purchases by a former director of FTC Solar when he purchased nearly 90,000 shares at an average price of $2.26. The fact that this was a former director buying stock was a little surprising and caused me to dig deeper. Thurman J. Rodgers or T. J. Rodgers was the Chairman of the Board until January 2023 when he stepped down after serving on the board for five years. He was a founding investor of FTC Solar and has served on its board since its inception in 2017. Shaker Sadasivam, another director who has also been on the board since 2017, will take over as Chairman. The fact that Mr Rodgers is no longer on the board has not dampened his enthusiasm for the stock.
Mr. Rodgers received his Masters and Ph.D. degrees in chemical engineering from Stanford University in the 1970s and went on to found Cypress Semiconductors in 1982. Infineon Technologies acquired Cypress Semiconductor in April 2020 in a $9.4 billion deal.