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Investing.com-- Analysts at BMO Capital Markets upgraded U.S. residential solar company Sunrun Inc (NASDAQ:RUN) to “Market Perform” from “Underperform” and raised its price target, citing growing confidence about capital return to shareholders by the second half of 2026.
BMO nearly doubled its PT on the stock to $19 from $10.
BMO analysts said their previous cautious stance was not solely based on policy or demand risks, but on skepticism over whether Sunrun’s cash generation metric would drive valuation or lead to shareholder returns.
“RUN appears to be in a better position and willing than we expected to commence either repurchase of shares or offer a dividend in 2H 2026,” analysts wrote.
The brokerage is now incorporating a cash generation–based valuation, estimating Sunrun will generate $444 million in FY 2026, resulting in a secured debt-to-cash generation ratio below 2x -- a threshold that could enable capital returns.
BMO cautioned the upgrade could prove premature if customer payment rates weaken or credit spreads widen.