Sunrun, SolarEdge Slip on Slow Rooftop Demand at SolarCityby
SolarCity is Sunrun's biggest rival, SolarEdge's top customer
SolarEdge affected by U.S. residential solar slowdown
Sunrun Inc., the second-biggest installer of U.S. rooftop power, and SolarEdge Technologies Inc., a provider of components for the systems, both slumped Tuesday after industry leader SolarCity Corp. reported a sharp slowdown in demand.
Sunrun slipped 14 percent to $6.37 at the close in New York, the most since Feb. 11. SolarEdge dropped 15 percent, the most since its initial public offering in March 2015.
SolarCity is Sunrun’s biggest competitor and SolarEdge’s top customer, and said Monday that new orders sank 33 percent in the first quarter, a potential sign of slowing demand for rooftop power systems. That was due in part to policy changes in Nevada that prompted both installers to exit the state at the start of the year, and there are similar concerns about other states.
“Regulatory debates in Massachusetts, New Hampshire and California have crimped install rates,” Jeffrey Osborne, an analyst at Cowen & Co. in New York, wrote in a research note Tuesday.
SolarEdge gets about 10 percent of its sales from SolarCity, which also lowered its 2016 installation forecast, expecting growth of about about 15 percent instead of 40 percent.
The decline in SolarEdge’s shares comes even after the Herziliya Pituach, Israel-based company said Monday that sales in its fiscal third quarter had increased 45 percent from a year earlier, and net income more than tripled to $20.8 million.
San Francisco-based Sunrun is expected to report earnings Thursday.