Needham & Company analyst, Edwin Mok, cut his PT on SolarEdge Technologies (NASDAQ: SEDG) to $36 from $38 after another company feels the heat from weak domestic retail solar installations. No change to Buy rating as the analyst thinks this is a transient problem.

F3Q16 (Mar) beat, again. Rev/NG EPS of $125MM/$0.51 beat the Street's $123MM/$0.37 even with the SUNE [N/R] writedown. GM of 32.7% was up another 160bps QoQ due to favorable mix of less-European sales, stable pricing, cost reduction and FX. Other income benefited EPS by ~$0.04/sh.

F4Q16 (June) guidance was below consensus, but revenue recognition of HD-Wave inverters is a factor. Revenue guidance of $125MM-$134MM was below the Street's $131MM and likely disappoints investors. While general weakness in the U.S. residential market and mix shifts towards Europe with lower ASPs pressure the JunQ. Shipments should be above the revenue range due to no revenue recognition of the HD-Wave inverter based on the company's policy.

Investors were acutely aware of slowed demand in the U.S. residential market, which was confirmed by this and SCTY's [Hold] reports. However, we believe the larger players are seeing greater pressure due to the tightening of capital needed for solar leases, and SEDG has done a good job broadening its customer base, bring SCTY down to low-teens-% in MarQ while a distributor became the largest customer. Moreover, the U.S. commercial business continues to grow in MarQ. Mgmt is targeting commercial to grow to a similar size as the residential business by the end of 2017, highlighting the strong momentum of the business.

Raising FY16E NG EPS to $1.73 from $1.69 but reducing FY17E to $2.01 from $2.24.

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Shares of SolarEdge Technologies closed at $22.59 yesterday.