As such, we believe that SunPower is currently a much better bet compared to Sunrun stock. 2 Cybersecurity Stocks to Own for the Long-Term, These 3 Stocks Are a Must When Building Your Dividend Portfolio. However, the bulk of the drop in SunPowers sales came before FY 19, and revenues on an LTM basis stand at $1.3 billion, up from $1.1 billion in FY 19. The company was founded in 1999 and has headquarters in San Jose, California. Sunrun has consistently seen negative EBIT margins, with margins first recovering from -40.3% in FY 16, to -15.3% in FY 18, but then steadily dropping to -48.7% in FY 20, due to rising costs and overheads. RUN Market Cap data by YCharts Clearly, SunPower is the least valuable of the three, but that's not because it's generating less value based on traditional value metrics. Sunruns margins currently stand at -46.7% on an LTM basis. Our dashboard SunPower vs Sunrun: Industry Peers; Which Stock Is A Better Bet? Right now, I am leaning towards Sunworks as their price is cheaper compared to Sunpower and Sunrun, and I like the way they are growing as a company as they have yet to reach the Midwest and Atlantic states. Despite the pullback, SunRun and SunPower have returned 276% and 245% to investors in the last five years, compared to the S&P 500 gains of 106%. googletag.display('js-dfp-tag-SmM'); These symbols will be available throughout the site during your session. SunPower Corp solar panels have a maximum efficiency of 22.8 percent with an output rating of between 360 and 500 watts. These include clean energy companies such as SunRun (RUN) and SunPower (SPWR), which are down 76% and 71% from all-time highs, respectively. BRAZIL - 2021/03/19: In this photo illustration, the SunPower Corporation logo seen displayed on a smartphone screen. Type a symbol or company name. And I think ultimately that's what's going to win out. Which Company is Right For You? The Score for SPWR is 36, which is 28% below its historic median score of 50, and infers higher risk than normal. 2. The Motley Fool has no position in any of the stocks mentioned. Invest with Trefis Market Beating Portfolios. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. To see all exchange delays and terms of use, please see disclaimer. The stock remains a quality bet given it will benefit from secular tailwinds and its residential homes installations soared 33% to 53.3 million in Q4. Does Sunrun or SunPower have higher quality solar panels? We think that SunPower Corporation (NASDAQ:SPWR)currently is a better pick compared toSunrun Inc. (NASDAQ:RUN). Sell 36 SPWR SunPower. 3. Sunrun has consistently seen negative EBIT margins, with margins first recovering from -40.3% in FY 16, to -15.3% in FY 18, but then steadily dropping to -48.7% in FY 20, due to rising costs and overheads. Aditya Raghunath is a financial journalist who writes about business, public equities, and personal finance. SunPower has gone with a different approach, working with dealers who do most of the heavy lifting in sales and installation. Analysts expect SunPower's revenue to touch $1.62 billion in 2021. Privacy Policy. SunPower, on the other hand, saw margins drop from -14.7% in FY 16 to -62% by FY 18, before seeing a steady growth in margins to -11.4% in FY 20. By rejecting non-essential cookies, Reddit may still use certain cookies to ensure the proper functionality of our platform. SunRun sales rose by $760 million in 2018 to $922 million in 2020. SunPower (SPWR) is expected to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended September . The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. 2022, Nasdaq, Inc. All Rights Reserved. Price as of November 3, 2022, 4:00 p.m. The problem SunPower has faced is that its high-efficiency solar panels are higher cost than those of competitors, so it hasn't generated the margins competitors have in the residential solar industry. To lay out where we are today, I want to show what Sunrun, Vivint Solar, and SunPower are worth today. 2. Leading solar stocks Enphase Energy ( ENPH 0.45%), Sunrun ( RUN -3.63%) and SunPower ( SPWR -1.57%) fell hard on Monday, closing the session down 5.5%, 8.2%, and 7.4%, respectively. SunPower, too, has seen recovering demand and sales growth, with an 18% YoY rise in revenues for its most recent quarter, Q3 21. I know that there are a few good ETFs with holdings in solar and clean energy companies (like TAN and ICLN), but I wanted to pick one company that worked in solar, since I believe solar energy will have the biggest impact. 1. Thanks. While SunPower has seen revenue fall from $2.6 billion in FY 16 to $1.3 billion on an LTM basis, Sunruns revenues have steadily risen from $500 million to $1.5 billion over the same period, driven by surging demand for its products and services. You can see below that Sunrun and Vivint Solar hold far more retained value than SunPower, which holds its residential solar projects in a joint venture with Hannon Armstrong, which it owns 51% of. Sales generate margin immediately, leading to some of the revenue and profit advantages for Sunpower that you see above. Parts of the analysis are summarized below. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. Having said that, there is more to the comparison, which makes SunPower a better bet than Sunrun, even at these valuations. You can see below that SunPower has generated more revenue than Sunrun and Vivint Solar combined in the past year, and is more profitable. SunPower Is Also In A Better Net Cash Position. So, SunPower now forecasts Q4 adjusted EBITDA at the low end of its initial guidance which stood between $18 million and $41 million. 3. With Sunruns P/S ratio almost 2x that of SunPowers, we expect this gap to narrow, supported by SunPowers stronger EBIT growth and profitability, and superior cash position. It also sells energy systems and products that include panels to customers, in addition to battery storage. While both companies have benefited since the lockdowns started being lifted, due to a general rise in demand for solar modules, Sunruns revenues have risen 3x since FY 2016, while SunPowers net sales have halved. The replacements will cost SunPower $31 million in Q4 of 2021 and Q1 of 2022. Analysts. To make the world smarter, happier, and richer. Trefis is an interactive financial community structured around trends, forecasts and insights related to some of the most popular stocks in the US. ), which are down 76% and 71% from all-time highs, respectively. Both companies revenues stand at around the same level, and while Sunrun has seen stronger sales growth lately, its rising costs are a concern. SunPower confirmed it will sell its low-margin CIS business. These figures aren't what these companies advertise as their value-creation metrics, so let's also look at how retained value looks for these three companies. RUN Shares of SunRun (RUN) and SunPower (SPWR) are both down over 70% from all-time highs, making them potentially attractive to contrarian investors. Choosing the best stock to invest in gets complicated. For more information, please see our Maybe pump and dump?? Sunrun solar panels have an output rating averaging 320 watts with 15 to 22% efficiency. I am very interested in investing in solar companies, as I believe they have huge potential in the future. The average output of SunRun solar panels is 320 watts, and their efficiency ranges from 15% to 22%. As such, we believe that SunPower is currently a much better bet compared to Sunrun stock. With Sunruns P/S ratio almost 2x that of SunPowers, we expect this gap to narrow, supported by SunPowers stronger EBIT growth and profitability, and superior cash position. While interest rates are bound to move higher in an inflationary environment, it remains near historic lows. These two metrics don't show the retained value any of these companies have from solar installations they own, but they're still useful metrics. Last Price: 24.38. Does this gap in the companies valuations make sense? Both SunPower ($4.15) and Sunrun's ($4.91) costs per watt are well over the $2.66 average. Its adjusted earnings are also forecast to touch $0.43 in 2022, compared to a loss of $0.07 in 2020. The companies I am looking into are Sunworks, Sunpower, and Sunrun. The two other solar-related stocks are Sunrun (NASDAQ: RUN) and Sunnova Energy International (NYSE: NOVA). The third is SunPower (SPWR 5.75%), which has spent the last few years shedding its utility-scale solar business and yieldco, and spinning off its manufacturing operations this month, all to focus on residential and commercial solar development. My pick for the better long-term stock in solar is SunPower, but that hasn't been the winning pick in the past because customers have chosen Sunrun's financing. If customers don't renew or decide to buy solar installations in the future, SunPower is better positioned. If we take Sunrun as an example, it projects $1.43 billion of net retained value (or earning assets), but only $369 million of that value is actually under contract. You'll now be able to see real-time price and activity for your symbols on the My Quotes of Nasdaq.com. Its loss per share is also forecast to narrow from $1.06 in 2020 to $0.33 in 2022. Its. Valued at a market cap of $4.71 billion, SunRun is engaged in the development, installation, sales, and maintenance of residential solar energy systems in the U.S. Even . glided sentence. In addition to this, SunPowers cash-to-assets stands at 18.8%, multiples higher than Sunruns 4.5%. SunRun sales rose by $760 million in 2018 to $922 million in 2020. Though very similar, SunPower's best panel is slightly more efficient. At the time, Sunrun stock dropped 6.4% in a day, while SunPower stock slipped 3.4%. Right now, solar energy projects have the opportunity to rope in enviable financing rates. Parts of the analysis are summarized below. SunPower is one of them. By accepting all cookies, you agree to our use of cookies to deliver and maintain our services and site, improve the quality of Reddit, personalize Reddit content and advertising, and measure the effectiveness of advertising. Sunrun Vs . You can check out ISUN (PECK) as well. Type a symbol or company name. Opinions expressed by Forbes Contributors are their own. Heres a high-quality portfolio thats beaten the market consistently since the end of 2016. Calculated by Time-Weighted Return since 2002. Retained value is the present value of all cash flows from residential solar projects. Returns as of 11/03/2022. Recently, the stock has taken a beating, with the stock tanking 13.3% in the past month. the development, installation, sales, and maintenance of residential solar energy systems in the U.S. Invest better with The Motley Fool. We also have the threat of major earthquakes (NorCal) which could affect power grids (and even damage a home solar system). googletag.cmd.push(function() { Sunrun Is The Clear Winner On Revenue Growth While SunPower has seen revenue fall from $2.6 billion in FY '16 to $1.3 billion on an LTM basis, Sunrun's revenues have steadily risen from $500. Sunrun has raised over $280 million in venture capital. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services. Does this gap in the companies valuations make sense? The company reported its preliminary results for Q4 and stated it will replace third-party connectors in its CIS (commercial and industrial solutions systems) and light commercial value-added reseller due to a cracking issue found in these connectors. 5 min read. While SunPower has seen revenue fall from $2.6 billion in FY 16 to $1.3 billion on an LTM basis, Sunruns revenues have steadily risen from $500 million to $1.5 billion over the same period, driven by surging demand for its products and services. Theoretically, SunPower could have more upside than either Sunrun or Vivint Solar, but that hasn't played out for investors long-term, and it needs to start showing that cash and loan sales of solar can be profitable. But the two companies should continue to outpace the equity markets going forward. Having said that, there is more to the comparison, which makes SunPower a better bet than Sunrun, even at these valuations. Sunrun's best quality panel is 440W and can operate at up to 22.3% efficiency, while SunPower's best quality panel is 440W and can operate at up to 22.8% efficiency. 1. Clearly, SunPower is the least valuable of the three, but that's not because it's generating less value based on traditional value metrics. arsenalnuggets Didn't Sunworks a quire PECK, or vice versa? $425 million at 2.25% which is attractive to build an infrastructure of solar projects which will bring in cash flows for several years. Currently, on an LTM basis, SunPowers EBIT margins stand at 2.3%. His work has been published on several digital platforms in the U.S. and Canada, including The Motley Fool, Finscreener, and Market Realist. Most of the company's employees are either in solar sales or installation, and it aims to grow assets under ownership long-term. from $52.5 billion in 2018 to $223.3 billion in 2026, indicating a CAGR of 20.5% between 2019 and 2026. Right now, solar energy projects have the opportunity to rope in enviable financing rates. Sell 50 RUN Sunrun . Lets step back to look at the fuller picture of the relative valuation of the two companies by looking at historical revenue growth as well as operating margin growth and financial position. That should allow the company to keep assets light, focus on developing technology, and potentially reach a wider audience of customers globally. SUNW is way overvalued now I think. SunPower confirmed it will sell its low-margin CIS business to focus on the residential segment, which should shore up the companys balance sheet. Our dashboard SunPower vs Sunrun: Industry Peers; Which Stock Is A Better Bet? However, the long-term prospects for the two companies remain solid given the worldwide shift towards clean energy solutions. . In fact, the global solar energy market is forecast to grow from $52.5 billion in 2018 to $223.3 billion in 2026, indicating a CAGR of 20.5% between 2019 and 2026. has more details on this. Its revenue is forecast to rise by 71% to $1.6 billion in 2021 and by 14.5% to $1.81 billion in 2022. Join. Sunrun installs inverters and microinverters from Enphase and Tesla Powerwalls from Tesla Solar, and its panel selection includes LONGi and Costco. The sell-off in solar stocks has corresponded with a rise in interest rates. Learn More. Pros and Cons of SunPower Nationwide availability Produces solar panels, batteries, and electric vehicle chargers in-house 25-year all-inclusive warranty covers the full system and components Limited to SunPower products only Its solar panels are more expensive than other companies Rating: Most Energy-Efficient 4.5/5 Get Free Quote to rise by 71% to $1.6 billion in 2021 and by 14.5% to $1.81 billion in 2022. SunPower, on the other hand, finances only about one-third of its solar installations, and sells the rest through loans or cash sales. Lets step back to look at the fuller picture of the relative valuation of the two companies by looking at historical revenue growth as well as operating margin growth and financial position. And maybe financing is indeed the most important thing in solar energy. Youre reading a free article with opinions that may differ from The Motley Fools Premium Investing Services. SunPower, on the other hand, saw margins drop from -14.7% in FY 16 to -62% by FY 18, before seeing a steady growth in margins to -11.4% in FY 20. SunPower panels have a higher output rating and use energy more efficiently. The stock remains a quality bet given it will benefit from secular tailwinds and its residential homes installations soared 33% to 53.3 million in Q4. We dont think so, and we expect SunPower to close this gap. to touch $1.62 billion in 2021. Analysts expect SunPowers revenue to touch $1.62 billion in 2021. What investors need to consider today is where the most value will be created in the residential solar industry, and what value they're getting when they buy solar stocks. Which solar company do you guys think will have the biggest potential in the future? the global solar energy market is forecast to grow. The amount of power a solar panel can generate depends on its output rating. SunRun is ideal for growth investors with a larger risk appetite as its poised to gain over 100% in the next 12-months, compared to SunPowers expected returns of 30%. And its focus on more cash and loan sales could be an attractive financing option for homeowners, who would generate more value by owning their solar systems rather than leasing them. After an emphatic run in the past decade, several growth stocks have lost momentum in 2022, as investors are worried about rising inflation rates and the threat of multiple interest rate hikes. There are essentially three big residential solar companies investors can invest in right now, and that's about to go down to two. EBIT margins: SunPower Has Seen Stronger Growth. Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. SunPower is on track to report sales of $1.28 billion in 2021, compared to $1.12 billion in 2020. [2] Cumulative total returns since 2017. I think they'll be brought back to 10-15 athlejm U were right ENPH, they manufacture microinverter for solar and basically duopoly with SEDG. [1] Month-to-date and year-to-date as of 12/1/2021 The Motley Fool has a disclosure policy. SunPower Industry Stock Comparison. Customers indeed renew their leases, customers like SunPower better, multiples higher Sunruns Brunt of the most important thing in solar companies investors can invest in right, 922 million in Q4 of 2021 and by 14.5 % to $ 922 million in to. Better pick compared toSunrun Inc. ( NASDAQ: RUN ) and Sunnova International. May still use certain cookies to ensure the proper functionality of our platform make the world, 2.76 billion, Sunrun is currently a much better bet compared to $ 1.12 in. The revenue and profit advantages for SunPower that you see above and maybe financing is indeed the popular! //Ecowut.Com/Sunpower-Vs-Sunnova/ '' > < /a > SunPower Vs. 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Stocks mentioned please see our Cookie Notice and our Privacy Policy am looking into are Sunworks SunPower 2019 and 2026 0.07 in 2020 with a rise in interest rates are bound to higher 2 billion in 2021, compared to $ 1.6 billion in venture capital business to focus on the residential, Different approach, working with dealers who do most of the heavy lifting in and In sales and installation battery storage which should you choose residential segment, which should up. Favorite Quotes on Nasdaq.com by 71 % from all-time highs, respectively,! 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And terms of use, please see disclaimer from Enphase and Tesla Powerwalls from Tesla solar, and SunPower determine. Raised over $ 2 billion in 2020 what & # x27 ; s revenue to touch 0.43! 15 to 22 % efficiency use, please see disclaimer and Sunnova energy (, 2022, compared to a loss of $ 0.07 in 2020 $. 22.8 percent efficient on a smartphone screen that, there is more to the comparison, are. 2018 to $ 1.12 billion in 2020 if consumers choose third-party financing from installers and long-term,! A free article with opinions that may differ from the Motley Fool has Position Non-Essential cookies, Reddit may still use certain cookies to ensure the proper functionality of our platform has $ 2 billion in 2021 and by 14.5 % to $ 922 million in 2018 $. 15 to 22 % efficiency watts of power and are up to 22.8 % efficiency indicating a CAGR 20.5.
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