Beat-down Enphase is worth buying as its European business becomes a larger tailwind, according to Raymond James. Analyst Pavel Molchanov upgraded the solar stock to outperform from market perform. He set a price target of $225, implying the stock could rally 22.5% from where it closed Friday. "We are turning positive on Enphase for the first time since 2013, i.e., ancient history by solar industry standards," he said in a Monday note to clients. "This upgrade is partly opportunistic and partly thematic." Molchanov said he's trying to catch a "proverbial falling knife" amid what he called the broader industry's risk-off trade, but sees an opportunity in Enphase after the stock fallen 30.7% this year. He also said multiples are back within reason, pointing specifically to the 2024 price-to-earnings multiple of 26 compared with 40 in early 2021. By comparison, he said many clean technology stocks have price-to-earnings multiple that fall somewhere between 20x and 30x. While Molchanov said the trade is still more crowded than others, he added that'sdue in part to being one of the few clean technology stocks in the S & P 500 . He also said a potential share buyback or dividend is becoming possible for the first time, as the company hits a free cash flow yield of 4%. Enphase has also been helped by its successful push into Europe, Molchanov said, which may be even more of a benefit amid concerns over shifts in the California market with the potential for regulation changes. California only accounted for one-fifth of Enphase's sales mix last year while making up a third of the broader U.S. market. Europe made up 19% on Enphase's sales, up from 14% in 2021, and is expected to surpass 25% this year. Molchanov said companies with a large Europe business benefit from its strong climate policy and the focus on energy security following the Russian invasion of Ukraine. Despite the tailwinds, Molchanov said he's watching how corporate costs and margins move over time. He noted the company's performance could be impacted by changes to competition. The stock was up 1.2% before the bell. ENPH YTD mountain Enphase this year — CNBC's Michael Bloom contributed to this report.