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SolarCity Corporation Message Board

  • supersoaker30 supersoaker30 Nov 7, 2013 7:27 AM Flag

    For all the Lemmings here's SCTY Investing 1-0-1

    SCTY is not a solar company. It's an equipment installation company that is paying for systems today, leasing them to customers for 20 years and hoping they get paid for those systems. Remember the mortgage crisis???? Many customers will not make their payments long term so SCTY can then spend more money to remove those expensive systems. Now they are selling bonds or securitizing these systems to sell to investors at a guaranteed return. SCTY will be on the hook to make those payments even though many customers will stiff them so they will have to raise more capital to pay the bond holders. Equipment rental companies are a terrible business, lots of up front capital for small payments over 20 years. This is not a First Solar that has actual technology, this is an equipment installation and lease company. Can you say Boring!!! When the hype ends and the dust settles this is a $5-10 stock so don't get burned.

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    • Bagholders, you obviously did not read this prescient post this morning

    • Very nice summary.

      This company will never achieve the scale to be profitable. Since when is installing solar systems a growth industry ? It is extremely competitive and highlighted with very thin margins. The company recently announce a couple of new projects but are they profitable ? In my opinion, they were probably the lowest bidder and will lose money .

      They announced another dismal quarter yesterday afternoon and expect another whopping operating loss for Q4. Also they indicated that they expect to be cash flow positive in Q4 - don't count on it . I believe they said the same when they released results 2 quarters ago. Instead, they raised more money by issuing more stock and a convertible bond offering. It burns through cash at an alarming rate and don't be surprised if it tries to raise cash in the capital markets in 2014

      The joke with this stock valuation is that investors are piling in because of E.Musk
      Give me a break .

      $5-10 is too generous. Sub $5 is more accurate.

    • Fully idiot, residential solar is the future! got it!

      • 1 Reply to smarteri
      • Primarily in California. And the utilities can also push back on the Utility Commission to make changes and keep on offering reasons for adjustments to the tiered prices and solar pricing which could in one sweeping change have a large effect on costs for the company which is leveraging Net-Metering. This is a country which has a future of stable electric pricing due to more natural gas usage and it shows in some eastern states where electric prices are falling and solar incentives are not growing and SREC "selling" is not a selling point to residential buyers. In states like NY with newer NYSERDA incentives, there are chances to make money on a shorter term basis but 5-10 years, who knows.

        The one thing that SCTY has done to leverage the customer is factor in a 2.9% annual rate increase for the solar lease price. This is far more than most states' electricity price increases. In my own state, I am paying less per kWh than four years ago when I first started looking into Solar. I bought my own system from an independent dealer in late 2012 and enjoy it. SCTY has really no presence in my state and I would not have entered into a lease program.

        People should understand the mildly-predatory nature of the 2.9% "annual uplift" before signing a contract and before investing. I don't like this aspect of the contracts written and I would like to be at or hear a recording of a sales negotiation as to how this figure is presented to the homeowner.

    • Thank you, finally someone gets it. I unfortunately let go of some puts at the close but will be looking to borrow some stock.

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