Sunrun Inc (RUN, Financial), a leading player in the residential solar energy systems industry, has experienced a significant surge in its stock price. Over the past week, the company's stock has seen a remarkable 35.06% gain, while the past three months have witnessed a 27.87% increase. Despite this impressive performance, the current GF Value of $35 suggests caution, indicating a possible value trap, a sentiment echoed by the past GF Value of $43.68. This valuation calls for investors to think twice before making any decisions, as the current market cap stands at $4.31 billion with a price of $19.8 per share.
Introduction to Sunrun Inc
Sunrun Inc (RUN, Financial) operates within the semiconductors sector, focusing on the design, development, installation, and maintenance of residential solar energy systems across the United States. The company's business model involves acquiring customers directly or through partnerships, with solar systems constructed by either Sunrun or its partners. Customers typically enter into long-term agreements, spanning 20 to 25 years, to use Sunrun's solar energy systems. Additionally, Sunrun sells solar energy systems and related products, generating leads for potential customers. The company's innovative approach to residential solar solutions positions it as a key player in the renewable energy market.
Analyzing Sunrun's Profitability
Despite its growth, Sunrun's profitability remains a concern. The company's Profitability Rank is currently at 4/10, reflecting challenges in maintaining consistent profits. The Operating Margin stands at a concerning -34.53%, although it fares better than 10.44% of 958 companies in the industry. The ROE is at -18.61%, surpassing 13.82% of peers, while the ROA is -6.07%, better than 19.26% of competitors. The ROIC of -4.41% also outperforms 23.97% of similar companies. Over the past decade, Sunrun has managed to achieve profitability in 5 years, which is more favorable than 32.63% of its industry counterparts.
Growth Prospects of Sunrun Inc
Sunrun's Growth Rank is a solid 6/10, reflecting its potential for future expansion. The company's 3-Year Revenue Growth Rate per Share is an impressive 15.20%, outperforming 58.04% of 877 companies in the industry. The 5-Year Revenue Growth Rate per Share is also strong at 13.30%, better than 66.54% of its peers. Looking ahead, the Total Revenue Growth Rate (Future 3Y To 5Y Est) is estimated at 8.12%, which is more favorable than 58.62% of the industry. The 3-Year EPS without NRI Growth Rate stands at a remarkable 56.20%, surpassing 79.38% of companies, while the EPS Growth Rate (Future 3Y To 5Y Est) is projected at 25.84%, outshining 90% of the competition.
Notable Shareholders in Sunrun Inc
Several prominent investors have taken significant positions in Sunrun. Jeremy Grantham (Trades, Portfolio) holds 14,182,106 shares, representing a 6.51% stake in the company. Steven Cohen (Trades, Portfolio) follows with 3,050,722 shares, accounting for 1.4% ownership. Philippe Laffont (Trades, Portfolio) has a smaller share percentage at 0.08%, with 165,576 shares. These holdings reflect the confidence and interest of savvy investors in Sunrun's market potential.
Competitive Landscape
When compared to its competitors, Sunrun Inc stands out with a market cap of $4.31 billion. NEXTracker Inc (NXT, Financial) has a market cap of $2.86 billion, JinkoSolar Holding Co Ltd (JKS, Financial) is valued at $1.77 billion, and Shoals Technologies Group Inc (SHLS, Financial) comes close with a market cap of $2.78 billion. These figures highlight Sunrun's significant presence in the semiconductor industry, particularly within the renewable energy sector.
Conclusion
In conclusion, Sunrun Inc's recent stock performance has been impressive, with substantial gains over the past week and three months. However, the company's current GF Valuation suggests that investors should approach with caution. While Sunrun's profitability metrics show room for improvement, its growth prospects appear robust, with strong revenue and EPS growth rates. The company's position in the semiconductor industry is solid, and its comparison with competitors indicates a competitive edge in market capitalization. Ultimately, while the investment potential of Sunrun Inc is evident based on the provided data and analysis, the possible value trap indicated by the GF Value warrants careful consideration by value 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.
