Latest news with #InvescoSolarETF
CNBC
3 days ago
- Business
- CNBC
UBS says this solar stock can rally 75% even as U.S. budget bill poses risks to clean energy
Sunrun can surge from here even as a new U.S. budget bill poses a risk to the clean energy sector, according to UBS. Analyst Jon Windham kept his buy rating on the solar company. He did cut his price target to $12 from $17, but that still implies the stock could still gain 75% from Thursday's close. Sunrun shares have plunged nearly 26% this year and more than 52% over the past year, as traders ditch clean energy names under the Trump administration. The Invesco Solar ETF (TAN) has dropped more than 3% in 2025 and 13% in the past six months. The latest headwind for the sector comes after the U.S. House of Representatives on May 22 passed the "One Big Beautiful Bill Act," which proposes to eliminate the 30% Investment Tax Credit by the end of December. The bill has allowed homeowners to reduce their electricity costs by installing solar panels and battery storage systems. "Our lower target multiple reflects the overall intent of the House to seemingly remove all tax credits regarding residential solar and our relatively negative outlook on the Senate's willingness to preserve the credits compared to programs like the 45x manufacturing credit," Windham wrote in a Friday note to clients. RUN 1Y mountain Sunrun stock performance. But according to the analyst, Sunrun could remain resilient in the face of these cuts. If the residential tax credits are fully slashed, he said Sunrun could survive regulatory changes by structuring its Power Purchase Agreement options, getting more state-level policy support and transitioning to end markets such as commercial and industrial and community solar. He also noted that the company has strong assets. "Our estimates are unchanged as there is the potential for revisions in the U.S. Senate and possible that a final bill does not pass," Windham wrote. "We maintain our buy rating ... based on RUN's underlying $2.6bn portfolio of contracted net earning assets. In addition, we see potential upside scenarios beyond the U.S. budget bill." Wall Street remains split on Sunrun. Of the 25 analysts covering the stock, on rates it a strong buy, while 10 rate it a buy and 12 give it a hold, per LSEG.
Yahoo
23-05-2025
- Business
- Yahoo
Solar stocks hit with steep losses as Trump tax bill threatens clean energy industry
Solar stocks are on track to close out the week with steep losses as Wall Street assesses last-minute changes slipped into the tax-and-spending bill approved by the House this week. Bottom line: The bill is a threat to the industry. SolarEdge (SEDG), Sunrun (RUN), Complete Solaria (SPWR), and Enphase Energy (ENPH) were among the biggest decliners this week. All were down by double-digit percentages despite a mild relief rally in the sector on Friday. Most of the damage came after the House passed Trump's "big, beautiful bill," which proposes ending key investment and production tax credits from the Biden-era Inflation Reduction Act three years earlier than Wall Street expected. The bill also requires eligible wind and solar projects to begin construction within 60 days of becoming law. While analysts believe the current version of the bill is unlikely to survive intact in the Senate, the prospect of tighter restrictions has spooked investors. To be finalized and signed into law in its current form — that would create a lot of disruption and layoffs, project cancellations, potentially bankruptcies," Raymond James investment strategy analyst Pavel Molchanov told Yahoo Finance. Molchanov expects the industry to ramp up lobbying efforts in the coming weeks to persuade the Senate to roll back the more severe provisions. Key senators representing states with large solar and wind industries are also likely to push for a more measured approach. "Dialing back these last-minute modifications from the last 48 hours, that would be a victory from the perspective of solar and wind," he added. Molchanov noted that the US installed a record 38 gigawatts of solar capacity last year; further records were in sight this year. "After the tax credit expires — whenever that may be — there will be a decline in the amount of wind and solar installations. Will it go to zero? No, absolutely not," he added. "There will always be solar and wind projects getting built. It's just a matter of how many." The clean energy industry has had a volatile year as elevated interest rates have kept borrowing costs high. President Trump's return to the White House has added pressure to the sector, with his administration talking down green energy initiatives in favor of fossil fuels. On the manufacturing side, companies involved with batteries and panels have leaned into plans to onshore operations in response to Trump's tariff policies. In a move welcomed by the solar sector, the US Department of Commerce announced plans to impose tariffs as high as 3,521% on panel imports from four Southeast Asian countries. Despite a recent rally fueled by hopes that clean energy tax credits might be preserved, the Invesco Solar ETF (TAN) is down more than 6% year to date, falling over 7% in the wake of the House vote. Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre. Click here for in-depth analysis of the latest stock market news and events moving stock prices
Yahoo
23-05-2025
- Business
- Yahoo
Solar stocks hit with steep losses as Trump tax bill threatens clean energy industry
Solar stocks are on track to close out the week with steep losses as Wall Street assesses last-minute changes slipped into the tax-and-spending bill approved by the House this week. Bottom line: The bill is a threat to the industry. SolarEdge (SEDG), Sunrun (RUN), Complete Solaria (SPWR), and Enphase Energy (ENPH) were among the biggest decliners this week. All were down by double-digit percentages despite a mild relief rally in the sector on Friday. Most of the damage came after the House passed Trump's "big, beautiful bill," which proposes ending key investment and production tax credits from the Biden-era Inflation Reduction Act three years earlier than Wall Street expected. The bill also requires eligible wind and solar projects to begin construction within 60 days of becoming law. While analysts believe the current version of the bill is unlikely to survive intact in the Senate, the prospect of tighter restrictions has spooked investors. To be finalized and signed into law in its current form — that would create a lot of disruption and layoffs, project cancellations, potentially bankruptcies," Raymond James investment strategy analyst Pavel Molchanov told Yahoo Finance. Molchanov expects the industry to ramp up lobbying efforts in the coming weeks to persuade the Senate to roll back the more severe provisions. Key senators representing states with large solar and wind industries are also likely to push for a more measured approach. "Dialing back these last-minute modifications from the last 48 hours, that would be a victory from the perspective of solar and wind," he added. Molchanov noted that the US installed a record 38 gigawatts of solar capacity last year; further records were in sight this year. "After the tax credit expires — whenever that may be — there will be a decline in the amount of wind and solar installations. Will it go to zero? No, absolutely not," he added. "There will always be solar and wind projects getting built. It's just a matter of how many." The clean energy industry has had a volatile year as elevated interest rates have kept borrowing costs high. President Trump's return to the White House has added pressure to the sector, with his administration talking down green energy initiatives in favor of fossil fuels. On the manufacturing side, companies involved with batteries and panels have leaned into plans to onshore operations in response to Trump's tariff policies. In a move welcomed by the solar sector, the US Department of Commerce announced plans to impose tariffs as high as 3,521% on panel imports from four Southeast Asian countries. Despite a recent rally fueled by hopes that clean energy tax credits might be preserved, the Invesco Solar ETF (TAN) is down more than 6% year to date, falling over 7% in the wake of the House vote. Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre. Click here for in-depth analysis of the latest stock market news and events moving stock prices Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
18-05-2025
- Business
- Yahoo
Why solar stocks have soared — and why there's trouble ahead for the rally
Solar stocks outpaced a rally in the broader market this week. The sector surged after a key budget bill kept tax credits intact. But the bill proposes changes that could slow the solar industry's buildout. Sunshine is beaming down on solar stocks after policymakers saved the clean energy sector from a potentially dire threat, but there are still clouds looming over the sector. Last week, the industry was relieved after a long-awaited budget bill left most industry credits intact. In the words of JPMorgan, the bill satisfied the "more bullish end" of expectations, sparing the sector-boosting credits from the chopping block. The May 12 draft bill unleashed a comeback rally for top solar names, which outpaced a broader rally in the week. First Solar surged nearly 23% between Monday and Friday, while Array Technologies, Nextracker, and Sunrun jumped 27%, 19%, and 26%, respectively. The Invesco Solar ETF jumped more than 10% in the week, about double the gain of the S&P 500. By all accounts, the proposed legislation is an optimistic outcome amid White House administration opposition to clean energy buildout. It keeps alive tax benefits that have propelled solar's record-breaking buildout in 2024. But as enthusiastic as solar investors might get, the new bill faces challenges from Republicans looking for deeper spending cuts to fund tax breaks for households and companies. Even in its current form, the bill could disrupt industry momentum. Under the proposal, businesses would be able to take advantage of tax credits only when a solar project starts generating electricity, and this would have to occur by 2029 — after that, credits would start to phase out. It's a simple but consequential shift from current setup, where credits are unlocked once construction begins. "If you fail — often for no fault of your own — to be able to bring it online by the deadline, then suddenly your economics have changed," Michael Carr, executive director of the SEMA Coalition, told Business Insider. "And so what we have observed is, with a placed-in-service standard, banks are becoming increasingly unwilling, as far as like three or four years out, to finance these projects." Also of note are more stringent provisions on "foreign entities of concern," which could effectively block a manufacturer from tax benefits if their project uses equipment, materials, or IP from specific regions outside the US. The new language targets even sub-components, the type of equipment that American manufacturers exclusively source from places like China. "My preliminary understanding is that there are probably many, many pieces of equipment that use Chinese IP, because China is the leader in the solar supply chain," Sylvia Leyva Martinez, a principal analyst at Wood Mackenzie, explained to BI. She added: "How is the IRS going to look into that?" The industry might not know for years, given that previous guidance has taken a while to come out, Carr said — all amounting to a bout of new uncertainty. In its note, JPMorgan acknowledged the same drawbacks, but highlighted that one proposal could give domestic manufacturers a leg up. Restrictions against prohibited foreign-entities from qualifying for 45x credits would provide a key advantage to First Solar, and, to a lesser degree, names such as Nextracker, Enphase Energy, and SolarEdge. Aside from headwinds related to the tax bill, solar hasn't been spared from the tariff chaos. Trade whiplash has created the same uncertainty that looms over other industries, complicating business decisions for solar firms. Price hikes could hit the industry, and even last year's supply glut of solar panels might not help. Meanwhile, industry confidence has chilled amid the Trump administration's energy policies, which focus on uplifting non-renewables and, at times, slashing clean energy initiatives. But Leyva Martinez thinks the White House has good reason not to target solar, given the sector's crucial role in the artificial intelligence buildout. "There is an impending boom in demand," she said, citing that both renewables and non-renewables will need to be tapped to meet enormous energy needs. "We'll need to see if that leads to any major policy changes that could potentially — not benefit — but at least not harm." Read the original article on Business Insider Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Insider
18-05-2025
- Business
- Business Insider
Why solar stocks have soared — and why there's trouble ahead for the rally
Solar stocks outpaced a rally in the broader market this week. The sector surged after a key budget bill kept tax credits intact. But the bill proposes changes that could slow the solar industry's buildout. Sunshine is beaming down on solar stocks after policymakers saved the clean energy sector from a potentially dire threat, but there are still clouds looming over the sector. Last week, the industry was relieved after a long-awaited budget bill left most industry credits intact. In the words of JPMorgan, the bill satisfied the "more bullish end" of expectations, sparing the sector-boosting credits from the chopping block. The May 12 draft bill unleashed a comeback rally for top solar names, which outpaced a broader rally in the week. First Solar surged nearly 23% between Monday and Friday, while Array Technologies, Nextracker, and Sunrun jumped 27%, 19%, and 26%, respectively. The Invesco Solar ETF jumped more than 10% in the week, about double the gain of the S&P 500. By all accounts, the proposed legislation is an optimistic outcome amid White House administration opposition to clean energy buildout. It keeps alive tax benefits that have propelled solar's record-breaking buildout in 2024. But as enthusiastic as solar investors might get, the new bill faces challenges from Republicans looking for deeper spending cuts to fund tax breaks for households and companies. Credit complexities Even in its current form, the bill could disrupt industry momentum. Under the proposal, businesses would be able to take advantage of tax credits only when a solar project starts generating electricity, and this would have to occur by 2029 — after that, credits would start to phase out. It's a simple but consequential shift from current setup, where credits are unlocked once construction begins. "If you fail — often for no fault of your own — to be able to bring it online by the deadline, then suddenly your economics have changed," Michael Carr, executive director of the SEMA Coalition, told Business Insider. "And so what we have observed is, with a placed-in-service standard, banks are becoming increasingly unwilling, as far as like three or four years out, to finance these projects." Also of note are more stringent provisions on "foreign entities of concern," which could effectively block a manufacturer from tax benefits if their project uses equipment, materials, or IP from specific regions outside the US. The new language targets even sub-components, the type of equipment that American manufacturers exclusively source from places like China. "My preliminary understanding is that there are probably many, many pieces of equipment that use Chinese IP, because China is the leader in the solar supply chain," Sylvia Leyva Martinez, a principal analyst at Wood Mackenzie, explained to BI. The industry might not know for years, given that previous guidance has taken a while to come out, Carr said — all amounting to a bout of new uncertainty. In its note, JPMorgan acknowledged the same drawbacks, but highlighted that one proposal could give domestic manufacturers a leg up. Restrictions against prohibited foreign-entities from qualifying for 45x credits would provide a key advantage to First Solar, and, to a lesser degree, names such as Nextracker, Enphase Energy, and SolarEdge. Uncertainty heats up Aside from headwinds related to the tax bill, solar hasn't been spared from the tariff chaos. Trade whiplash has created the same uncertainty that looms over other industries, complicating business decisions for solar firms. Price hikes could hit the industry, and even last year's supply glut of solar panels might not help. Meanwhile, industry confidence has chilled amid the Trump administration's energy policies, which focus on uplifting non-renewables and, at times, slashing clean energy initiatives. But Leyva Martinez thinks the White House has good reason not to target solar, given the sector's crucial role in the artificial intelligence buildout. "There is an impending boom in demand," she said, citing that both renewables and non-renewables will need to be tapped to meet enormous energy needs. "We'll need to see if that leads to any major policy changes that could potentially — not benefit — but at least not harm."
