Sunrun stock price crashed this week as concerns about the future of the solar energy industry continued. RUN plunged to a low of $6.15 on Thursday after House Republicans passed the Big Beautiful Bill. It has now slipped by over 60% from its highest point in 2024.
Why Sunrun stock price crashed
Sunrun and other solar energy stocks like Enphase and SolarEdge plunged this week as investors reacted to the text of the Big Beautiful Bill, which passed in the House of Representatives.
One of the provisions of the bill is to cut incentives for households to install solar energy. It would strip away the tax credits for companies that lease solar systems and homeowners who lease them.
Analysts warn that the $20 billion solar energy in the US will be on life support if the incentives end. Donald Trump has supported ending these incentives, which were part of Joe Biden’s Inflation Reduction Act (IRA), which he calls the “Green New Scam.”
Still, all is not lost for Sunrun and other solar stocks. For one, the bill needs to pass in the Senate, where some moderate officials like Lisa Murkowski have expressed concerns about gutting the clean energy provisions. Therefore, the RUN stock price will react to any new developments in Washington.
However, the company still faces major challenges, which explains why its stock has crashed from $100 in 2020 to $6.88 today. Its performance was not strong during the Biden era when he created a conducive environment for the industry.
Sunrun struggled as inflation reduced the incentives of customers to move to solar and other clean energy solutions. It is also reeling from Trump’s tariffs on imported equipment, high interest rates that affect the borrowing costs, and reduced incentives in California.
Under Gavin Newsom, California slashed the amount of money that homeowners receive for electricity they supply to the power grid.
RUN earnings have slowed
Its financial results show that the company’s business has been slowing in the past few years. Its annual revenue fell from $2.03 billion last year, down from $2.25 billion last year and $2.32 billion.
Sunrun’s profits have also worsened. It made a net loss of $1.6 billion in 2023 and $2.84 billion last year.
The most recent earnings showed that Sunrun’s aggregate subscriber value rose to $1.2 billion, while its cash generation rose to $56 million. It expects that its cash generation guidance will be between $200 million and $500 million. Talking about the above challenges, the CEO said:
“Like many companies across the country, we are controlling what we can and are ready to adapt to changes that may occur. Sunrun has faced periods of major change over the last few years, and we used it as an opportunity to become even stronger.”
RUN stock price analysis
The daily chart shows that the RUN share price peaked at $22.15 in August and then plunged to the current $6.8. It had its worst daily decline on Thursday after the House passed the Big Beautiful Bill.
The stock moved below the 50-day and 100-day Exponential Moving Averages (EMA). It also moved below the key support at $8.40, the lowest swing in October 2023. Top oscillators like the Relative Strength Index (RSI) and the MACD have all pointed downwards.
Therefore, the Sunrun stock price will likely continue falling as sellers target the psychological point at $5. However, it may have some short-term rebound if the Senate rejects the curbs to clean energy incentives.
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