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Sunrun Seen Executing On Market Share, Profitability

Deutsche Bank provided its outlook on Sunrun Inc RUN 17.93%, maintaining its Buy rating and $15 price target on shares.

According to the analysts, the company's Q2 results and Q3 guide demonstrate strong execution both on market share and profitability front. They continue to see positive risk reward for Sunrun shares as they forecast the company to benefit from a healthy mix of direct sales and channel business, strong access to project capital and improving profitability driven by decreasing customer creation costs.

The three key points provided by Deutsche:

  • Q2 deployments of 65MW exceeded guidance of 60MW is driven mainly by a combination of slightly stronger demand in the channel business and solid growth in non-CA markets. Q3 deployments guide of 72MW was also up sequentially in contrast to flat/slightly down deployment guides of peers demonstrating Sunrun's strong execution capability.
  • Profitability in terms of NPV per watt improved significantly in Q2 to $94c from $40c in Q1.
  • The company does not anticipate any meaningful uptick in cash/loan mix. Q2 mix of loans was 16 percent and the management expects this mix to remain in the mid-teens to 20 percent range in the second quarter of 2016.
Jun 2016OppenheimerInitiates Coverage onOutperform
May 2016Guggenheim SecuritiesInitiates Coverage onBuy
May 2016Credit SuisseMaintainsOutperform

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