Solar stocks tumble to 3-year low as Solaredge drops 25% on demand warning

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Solar stocks, which have already had a difficult year, fell to their lowest levels in three years on Friday.

has significantly weakened, furthering battering sentiment on the renewable energy sector amid a difficult year.tumbled 8.5% Friday before the bell and was set to open Friday's trading session at $42.60, putting it at its lowest level since July 2020.

SolarEdge tumbled nearly 28% in early trading after it reported a miss on revenue, gross margins and operating income in the third-quarter, saying it estimates "significantly lower" revenue in the fourth-quarter.The solar sector was already struggling this year as rising interest rates hurt the financing environment for U.S. solar installation. SolarEdge and the TAN ETF were down 59.7% and 35.9% year-to-date, respectively, as of Thursday's close.

"After a second straight disappointing quarter of results/guidance, we find it hard to defend the stock: we underestimated the effects of the combination of ongoing inventory, end market demand, and now margin issues that are likely to serve as headwinds for the stock for the foreseeable future given what appears to be a significant deterioration in visibility," analyst Brian Lee said in a Friday note.

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