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This report is an updated version of the report published on 06 June 2022 at 10:29 AM New York Time, USA (GMT-4).
Sunrun Inc.
RUN Details
Sunrun Inc. (NASDAQ: RUN) is a home solar, battery storage, and energy services company. It was founded in 2007 with the objective of making local clean energy accessible to the people.
Result Performance for the period Q1FY22 ending 31 March 2022
Source: Company Reports, Analysis by Kalkine Group
Outlook
The management has opined that it expects Solar Energy Capacity Installed growth to be 25% or more in FY22. It also anticipates total value generated to grow at a faster pace than Solar Energy Capacity Installed for the full-year 2022, with Net Subscriber Values of above $10,000 in Q3FY22. Solar Energy Capacity Installed in Q2 is expected to be in a range between 235 and 245 megawatts.
Key Risks
The company is prone to Government regulations like licensing restrictions, coupled with risks associated with supply chain disruption. The business performance is also linked to the Group’s ability to retain its solar partners.
Valuation Methodology: EV/Sales Based Relative Valuation (Illustrative)
Stock Recommendation
Over the last one month, the stock has given a return of ~31.65%. The stock is trading lower than the average price of 52-week low-high range for the stock at $16.80-$60.60, respectively.
The stock has been valued using EV/Sales multiple based illustrative relative valuation method and the target price so arrived reflects a fall of low double-digit (in percentage terms). A slight premium has been applied to peer average EV/Sales multiple (NTM basis), considering the upgrade in guidance and robust demand outlook.
Considering the current trading levels and risks associated, we are of the view that it is prudent to book profits at the current levels. Hence, we give a “Sell” rating on the stock at the current price of $30.82 per share, as of 06 June 2022 at 9.32 am New York Time, USA (GMT-4).
Technical Overview:
Daily Price Chart
Source: REFINITIV, Note: Purple color line reflects Relative Strength Index (14-Period)
Sunrun Inc. (RUN) is a part of Kalkine’s Global Green Energy Portfolio
Note 1: The reference data in this report has been partly sourced from REFINITIV.
Note 2: Investment decisions should be made depending on the investors’ appetite on upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the analysis has been achieved and subject to the factors discussed above alongside support levels provided.
Kalkine Equities LLC provides general information about companies and their securities. The information contained in the reports, including any recommendations regarding the value of or transactions in any securities, does not take into account any of your investment objectives, financial situation or needs. Kalkine Equities LLC is not registered as an investment adviser in the U.S. with either the federal or state government. Before you make a decision about whether to invest in any securities, you should take into account your own objectives, financial situation and needs and seek independent financial advice. All information in our reports represents our views as at the date of publication and may change without notice.
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