• Washington promotes solar energy
• Deutsche Bank analyst optimistic about the industry
• Many buy recommendations for Sunnova and Sunrun
Climate change and the energy crisis are currently among the most pressing social problems. Companies that focus on renewable energies – eg wind or solar – promise to help solve both problems. The US government in Washington has also recognized this and passed significant tax credits for homeowners and other consumers of solar energy in August as part of the so-called Inflation Reduction Act.
Deutsche Bank optimistic for solar industry
In view of this, Deutsche Bank is now paying more attention to clean energy: “We are now analyzing the clean tech industry comprehensively and are adding six solar companies to our watch list. Our stance is bullish. Our assessment is supported by others government-sponsored policies like the recently passed Inflation Reduction Act,” explained Deutsche Bank analyst Corinne Blanchard. “This favorable legal situation and the improved incentives should further boost demand in the solar industry.” As she continues to write in her analysis, she assumes that the US solar market still has a lot of potential for growth.
Sunnova Energy International
TipRanks, a financial technology company that uses artificial intelligence to analyze big financial data, has now highlighted two solar companies that not only Blanchard, but also other analysts recommend to buy.
The first is Sunnova Energy International. The US company develops and constructs solar energy and energy storage systems and also installs them on the roofs of its customers inside and outside the US. The service also includes operation and maintenance, monitoring, repairs and device upgrades.
The third quarter of 2022 was very successful for Sunnova. The number of contract customers increased by almost ten percent to 246,600, which means that sales grew by a whopping 116 percent to USD 149.4 million compared to the same quarter in the previous year. With strong demand and the tailwind from the Inflation Reduction Act, the provider of solar and energy storage services expects continued strong or even stronger customer growth in 2023.
Corinne Blanchard sees Sunnova as well positioned for further growth and therefore agrees with this optimistic assessment. She expects customer growth of 43 percent in 2023 and believes that sales should climb to $710 million as a result. As a result, it gave Sunnova a “buy” rating and a price target of $36. The stock is currently trading at $22.52 (closing on November 22, 2022).
According to TipRanks, 13 analysts have recently rated Sunnova shares, with the stock receiving 11 buy and two hold recommendations. On average, they expect the share to rise to $35.42 over a 12-month period.
sun run
In addition, TipRanks also highlighted Sunrun Inc., a provider of residential solar roof panel systems and solar power batteries. In addition to the development, sale, installation and maintenance of these systems, the company also covers various other services, such as services related to energy management at home.
Like Sunnova, Sunrun presented strong figures for the third quarter of 2022. The company enjoyed a 21 percent increase in customers to 759,937 and an impressive 44 percent increase in revenue to $631.9 million compared to the same quarter last year.
Deutsche Bank analyst Corinne Blanchard sees Sunrun as having a strong presence in the US market following the passage of the Inflation Reduction Act. As a result, it rates the stock as “Buy” and has a price target of $36 over a 12-month horizon.
She is not alone in her positive assessment. According to TipRanks, a total of 13 analysts recommend Sunrun as a buy and one as a hold. On average, these 14 analysts see the price target at $48.15. For comparison: Most recently, the stock closed at $30.96 (closing on November 22, 2022).
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