Citi Double Downgrades Sunlight Financial Holdings (SUNL) to Sell

Citi analyst Arren Cyganovich downgraded Sunlight Financial Holdings (NYSE: SUNL) from Buy to Sell with a price target of $2.00 (from $4.00).

The analyst comments "We are downgrading Sunlight Financial to Sell/High Risk from Buy to reflect our concerns with potentially lower revenue coming from platform fee rate due to interest rate volatility and potential for lost production as it loses its largest installer. The company put out a release withdrawing its full-year guidance due to the impairment of $30M-$33M related to an advance to its largest installer. This appears to be idiosyncratic to this installer, but also likely means lower than expected loan production ahead. We are reducing earnings estimates due to lower loan production assumptions, near-term pressure to the platform fee, and a higher one-time loss provision related to this bankruptcy. We are lowering our target price to $2 from $4 reflecting our lowered EPS estimates with our valuation multiple remaining at 10x forward adjusted 2024 P/E. Our High Risk rating reflects recent stock volatility and uncertainty surrounding today’s announcement."

For an analyst ratings summary and ratings history on Sunlight Financial Holdings click here. For more ratings news on Sunlight Financial Holdings click here.

Shares of Sunlight Financial Holdings closed at $2.52 yesterday.

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