Sunrun Inc
.
RUN
is set to report third-quarter 2020 results on Nov 5, after market close.
In the last reported quarter, the company witnessed a negative earnings surprise of 200.00%. In the trailing four quarters, Sunrun delivered negative earnings surprise of 238.19%, on average.
Let’s take a closer look at the factors influencing the company’s upcoming quarterly results.
Factors Under Consideration
Sunrun has been experiencing lower order volumes in the recent past due to restricted access to certain sales channels, courtesy of the COVID-19 pandemic impacts. Resultantly, lower installation volumes have been hurting its top-line performance.
Although order volumes have started to improve since late April 2020, with the economy slowly starting to recover, it seems highly unlikely that order volumes reached the pre-COVID levels during the third quarter. Thus, we remain skeptical about the company’s ability to post revenue growth on a year-over-year basis in the soon-to-be-reported quarter.
However, grid service revenues are expected to have been solid on account of notable awards that the company received in the past couple of quarters.
Notably, the Zacks Consensus Estimate for third-quarter sales is pegged at $206.3 million, which indicates a 4.3% drop from the year-ago quarter’s reported figure.
In July, Sunrun announced that it will acquire Vivint Solar for an enterprise value of $3.2 billion. The deal was closed in September. We expect costs incurred to fund the transaction to have had an adverse impact on the company’s third-quarter earnings as well as cash flows.
Moreover, the impact of lower volumes might have resulted in less advantageous cost absorption, thereby hurting the company’s quarterly bottom-line performance.
The Zacks Consensus Estimate for the company’s third-quarter earnings is pegged at 2 cents per share, implying a deterioration of 91.3% from the year-ago quarter’s reported earnings.
Earnings Whispers
Our proven model does not predict an earnings beat for Sunrun this time around. The combination of a positive
Earnings ESP
and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But this is not the case here.
Earnings ESP
: The company’s Earnings ESP is -280.00%. You can uncover the best stocks to buy or sell before they’re reported with our
Earnings ESP Filter
.
Zacks Rank
: Sunrun currently carries a Zacks Rank #3. You can see
the complete list of today’s Zacks #1 Rank stocks here
.
Recent Solar Releases
Enphase Energy
ENPH
reported third-quarter 2020 adjusted earnings of 30 cents per share, which surpassed the Zacks Consensus Estimate of 24 cents by 25%.
First Solar
FSLR
reported third-quarter 2020 adjusted earnings of $1.45 per share, which surpassed the Zacks Consensus Estimate of 60 cents by 141.7%.
SunPower
SPWR
incurred an adjusted loss of 4 cents per share in third-quarter 2020, narrower than the Zacks Consensus Estimate of a loss of 5 cents.
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