Sunrun Inc (RUN, Financial), a prominent player in the semiconductor industry, has recently witnessed a significant uptick in its stock performance. Over the past week, the company's stock price has increased by 4.84%, and over the last three months, it has surged by an impressive 53.91%. Currently, Sunrun's market capitalization stands at $4.06 billion, with a stock price of $18.15. According to GuruFocus, the GF Value of Sunrun is estimated at $20.28, suggesting that the stock is modestly undervalued. This is a notable shift from three months ago when the GF Value was at $30.82, indicating a possible value trap scenario.
Overview of Sunrun Inc
Sunrun Inc specializes in the design, development, installation, sale, ownership, and maintenance of residential solar energy systems across the United States. The company not only acquires customers directly but also through partnerships with various solar and strategic partners. These solar systems, constructed by Sunrun or its partners, are owned by the company, with customers typically entering into 20- to 25-year agreements. Additionally, Sunrun sells solar energy systems and related products, enhancing its market presence in the renewable energy sector.
Assessing Sunrun's Profitability
Despite its growth, Sunrun's profitability metrics present a mixed picture. The company's Profitability Rank is currently at 4/10. Its Operating Margin stands at -33.86%, which, although low, fares better than 12.55% of 988 companies in the same sector. The Return on Equity (ROE) and Return on Assets (ROA) are -24.45% and -6.63% respectively, positioning Sunrun better than a small fraction of its peers. The Return on Invested Capital (ROIC) is -3.60%, higher than 26.2% of industry counterparts. Over the past decade, Sunrun has been profitable for five years, surpassing 30.98% of 920 companies.
Growth Trajectory of Sunrun
Sunrun's Growth Rank is impressive at 9/10. The company has demonstrated a robust 3-Year Revenue Growth Rate per Share of 16.40%, outperforming 70.43% of 920 companies. Its 5-Year Revenue Growth Rate per Share is 11.50%, better than 63.35% of 813 companies. Looking ahead, the estimated Total Revenue Growth Rate for the next 3 to 5 years is 9.06%, which is superior to 12.79% of 344 companies. However, the 3-Year EPS without NRI Growth Rate shows a decline of 19.00%, although it still ranks better than 22.84% of 718 companies. The future EPS Growth Rate is expected to rebound significantly to 20.21%.
Influential Shareholders
Notable investors in Sunrun include Jeremy Grantham (Trades, Portfolio) holding 16,310,540 shares (7.3%), George Soros (Trades, Portfolio) with 2,080,941 shares (0.94%), and Steven Cohen (Trades, Portfolio) owning 2,071,138 shares (0.93%). These major stakeholders play a crucial role in the company's strategic decisions and investor confidence.
Competitive Landscape
Sunrun faces stiff competition from companies like NEXTracker Inc (NXT, Financial) with a market cap of $5.74 billion, JinkoSolar Holding Co Ltd (JKS, Financial) valued at $993.659 million, and Shoals Technologies Group Inc (SHLS, Financial) with a market cap of $868.226 million. These competitors are closely aligned in terms of market capitalization and industry focus, making the landscape highly competitive.
Conclusion
In conclusion, Sunrun Inc's recent stock performance has been notably strong, driven by its strategic market positioning and growth prospects. Despite some challenges in profitability, the company's robust growth metrics and significant backing from influential investors suggest a positive outlook. As the company continues to navigate the competitive and evolving solar energy market, its current valuation indicates a potentially attractive entry point for investors.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
