US stock futures flounder amid tech weakness, Fed caution
Investing.com -- RBC Capital Markets upgraded Sunrun Inc (NASDAQ:RUN). to Outperform from Sector Perform and raised its price target to $16, saying recent Treasury guidance on solar tax rules removes overhang related to it. While also validating company’s long-term cash generation story.
The brokerage said new guidance on “commence construction” rules and domestic content requirements provides clearer visibility for residential solar incentives through 2029, easing concerns that a policy shift under the Trump administration could derail safe-harbor benefits.
RBC believes Sunrun now has better certainty to continue scaling its installations and sees cash generation improving sharply over the next two years.
Sunrun is also expected to benefit from the expiration of the federal 25D tax credit for customer-owned systems at the end of 2025. It could push more demand into third-party-owned solar systems (TPO), where Sunrun is the market leader.
RBC estimates nearly half of residential demand still comes from non-TPO systems today, but those installers may need to shift toward leasing or partner with Sunrun once the incentive expires.
RBC projects Sunrun will add around 139000 customers in 2026, roughly 20% year-on-year growth, with cash generation rising to about $550 million, up from $308 million in 2025.
Analysts see further upside from lower customer acquisition costs, storage adoption and higher electricity rates.
With the stock now trading at what RBC estimates is a roughly 15% cash yield to 2026, the firm argues the shares are undervalued relative to long-term growth potential.