SolarCity (SCTY): Trading Close To PowerCo NAV - Stifel
Stifel analyst, Sven Eenmaa, cut his PT to $46 on Buy rated SolarCity (NASDAQ: SCTY) after a widely expected guidance reduction. Despite the increased risk, the stock is trading close to the value of PowerCo assets that it does not warrant a downgrade from here.
SolarCity delivered project financing execution in 1Q16 to the extent that its DevCo+PowerCo generated cash post solar asset financings, and PV installations were strong, which we view positively. However, management reduced its 2016 guidance as was broadly speculated, and bookings still need to improve to support the lower guidance. Over the last several quarters SolarCity’s operational execution has showed increased volatility, which would need to subside to support investor confidence in value creation, in our view.
Target price goes from $56 to $46.
For an analyst ratings summary and ratings history on SolarCity click here. For more ratings news on SolarCity click here.
Shares of SolarCity closed at $22.51 yesterday.