Barclays maintains Sunrun stock rating, sees residential solar market shrinking

Published 14/07/2025, 13:48
Barclays maintains Sunrun stock rating, sees residential solar market shrinking

Investing.com - Barclays (LON:BARC) has reiterated an Equalweight rating and $15.00 price target on Sunrun (NASDAQ:RUN) in a recent research note. The stock, currently trading at $10.11, has shown significant volatility with a beta of 2.6. According to InvestingPro data, Sunrun’s market capitalization stands at $2.31 billion.

The investment bank projects the residential solar market will contract by approximately 20-25% in 2025, with the overall market tracking toward about 5 gigawatts of installations.

Despite the anticipated market shrinkage, Barclays expects third-party ownership (TPO) models like leases to gain significant market share, potentially growing from the current 55% to more than 90% next year.

The firm forecasts TPO providers could still grow by approximately 30% even amid the broader market contraction, while the loan and cash purchase segment may experience a steep decline of around 80%.

Barclays attributes this shift to changing consumer preferences, noting that many homeowners who previously opted for loan-financed systems may exit the market entirely rather than switch to leases when subsidies diminish.

In other recent news, Sunrun has been the focus of several significant developments. UBS has reiterated its Buy rating on Sunrun, raising the price target to $15.00, citing the company’s strong position in the residential solar leasing market. This follows the signing of a budget bill that impacts solar tax credits, favoring Sunrun’s leasing model. Jefferies has also upgraded Sunrun from Underperform to Hold, increasing the price target to $11.00, driven by the favorable outcome of the One Big Beautiful Bill Act, which supports solar leases through 2027. KeyBanc has upgraded Sunrun to Sector Weight, noting that regulatory risks have been mitigated, preserving tax benefits for leased solar equipment.

Citi analysts have observed positive momentum for Sunrun following the passage of the reconciliation bill, which has created a more favorable environment for residential solar companies. The bill’s provisions encourage accelerated construction of solar projects, potentially benefiting Sunrun. Meanwhile, the Senate’s advancement of a comprehensive tax-and-spending bill has preserved tax credits for solar leasing arrangements, providing a boost to Sunrun and other solar stocks. RBC Capital Markets analysts have noted the mixed implications of the updated bill for solar-linked clean energy stocks, while market reactions remain cautious amid recent volatility.

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