Solar energy provider, Sunrun Inc. RUN announced that it has successfully expanded its solar energy customer base by reaching seven new markets in the U.S. This has resulted in the company adding nearly 12 million homes and expansion of its service area.
The expansion will allow the company to distribute solar energy to New Mexico, Rhode Island, Texas, Vermont, Wisconsin, Pennsylvania, Washington, D.C., Nevada, and Florida nearly doubling Sunrun’s total addressable market, which will amount to an excess of 26 million users.
Recently in Jun, the company forayed in to the market of Florida by promising to offer solar power at more affordable rates to residents of the state. This involved the installation of rooftop solar panels at house, consumers can either own the system outright with Sunrun BrightBuy, or finance the system purchase with Sunrun Bright Advantage, using a loan arranged by Sunrun.
Additionally, Sunrun re-entered the state of Nevada after the policymakers passed legislation to reinstate solar net metering and establish a bill of rights for solar users. The bill is a step toward cutting down of net metering credit rates for homeowners, ensuring that utilities cannot burden users with unanticipated fees, and ensures transparent sales practices in the State.
What Lies ahead for Solar Stocks?
With the Trump administration having walked out of the Paris Agreement, where nearly 200 countries agreed to limit greenhouse gas emissions and move toward harnessing clean energy. For the time being, renewable companies – in particular solar stocks – are the ones being affected by this decision.
Even though coal stocks are expected to gain the most, state level incentives are being taken up to add renewables to the grid. At the Federal level, the solar investment tax credit remains the most important policy mechanism for supporting the solar industry, resulting in a huge boon to the industry and has been extended through 2021.
Notably, majority of solar projects undertaken are economic and are naturally going to prove beneficial for other stocks in the same industry such as that of SunPower Corporation SPWR, 8point3 Energy Partners LP CAFD, and First Solar, Inc. FSLR.
According to a U.S. Energy Information Administration (EIA) report, the total utility-scale solar electricity generating capacity at the 2016 was 21 giga-watts (GW). EIA expects solar capacity additions during the year will take it to 29 GW by the end of 2017 and 32 GW by the end of 2018.
It is quite evident that despite Trump’s efforts to revive the coal industry, the demand of renewable industry is continually on the rise with each passing day.
In the last six months, Sunrun has outperformed the Zacks categorized Solar industry. The company’s shares increased 33.2%, while the industry gained 20.4%.
This outperformance can be attributed to the company's growth strategy to develop relationships with third parties. It has been resourceful in establishing strategic relationships with market players across a variety of industries, including large retailers, to generate new customers.
The company’s continued expansion clearly indicates that it is already on the path of undertaking steps to introduce new products to expand footprint across states in the U.S.
Sunrun currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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