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On Wednesday, Jefferies analyst Julian Dumoulin-Smith adjusted the price target for Sunrun (NASDAQ:RUN), a leading home solar panel and battery provider, reducing it to $6.00 from the previous $7.00. With the stock currently trading at $7.19 and analyst targets ranging from $4 to $20, InvestingPro data shows the company is slightly undervalued based on its proprietary Fair Value model. Despite the adjustment, the firm sustained a Hold rating on the company’s shares.
The revision comes amid discussions on the Inflation Reduction Act (IRA) revisions in the House, and the anticipation of further softening from the Senate. Dumoulin-Smith noted that the critical issue for Sunrun would be whether the Senate decides to reverse the cut-off on residential leases set to begin in 2026. According to InvestingPro analysis, the company operates with significant debt concerns, with a debt-to-equity ratio of 5.23 and potential challenges in making interest payments.
Looking forward, the analyst suggested that if the Senate acts favorably, Sunrun could potentially extend the Investment Tax Credit ( ITC (NSE:ITC)) runway through a robust safe harbor strategy. Dumoulin-Smith believes that Sunrun is particularly well-positioned to implement this strategy successfully.
Investors are advised to keep an eye on near-term updates and to expect continued volatility in Sunrun’s stock. The analyst’s comments reflect a cautious stance on the company’s future, tied closely to legislative developments that could impact the renewable energy sector and Sunrun’s business model.
In other recent news, Sunrun has experienced varied analyst opinions regarding its stock. BMO Capital Markets downgraded Sunrun from Market Perform to Underperform, lowering the price target from $9.00 to $4.00. This decision was influenced by potential legislative changes that could impact Sunrun’s ability to claim solar Investment Tax Credits on residential solar leases. Conversely, Goldman Sachs raised its price target for Sunrun from $12.00 to $15.00, maintaining a Buy rating. The firm cited improved asset valuations and potential policy relief as factors in their decision.
JPMorgan reiterated its Overweight rating with a $13.00 target, noting Sunrun’s adaptable stance on proposed changes to the Investment Tax Credit incentives. The company also reported a positive response to its new Flex (NASDAQ:FLEX) product, which aims to address consumer demands. UBS analysts increased their price target for Sunrun to $17.00, maintaining a Buy rating, due to favorable renewable energy tax credit policy proposals. Mizuho (NYSE:MFG) Securities also raised its target to $16.00 and retained an Outperform rating, highlighting Sunrun’s strong first-quarter performance and strategic initiatives. These developments reflect a range of perspectives on Sunrun’s potential in the evolving renewable energy market.
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