Image source: SolarCity.
What: Shares of residential solar company Sunrun Inc jumped 21.6% in April as the company's solid performance in 2016 continued.
So what: Residential solar stocks in general did well in April, and a lot of the move was typical solar volatility. But there were a few notable items that could help the company.
San Francisco became the first city in the U.S. to require solar panels on all new buildings starting in 2017. Since it's only for new buildings I don't really think this is a needle mover for the industry, but the market seemed to like it nonetheless.
The other notable item was the abrupt resignation of #2 residential solar installer Vivint Solar's CEO Greg Butterfield. Vivint has gone through a lot in the last year with the SunEdison acquisition fiasco, but the fact that he's leaving may leave a big competitor in an even weaker position.
Now what: Shares of Sunrun have had a nice run the last few months, but the rubber really hits the road next week when the company reports earnings. On May 12, the company will give investors the numbers for the first quarter. We need to see continued cost reduction, sales growth, and the company's plans for a future that may be moving away from its lease/power purchase agreement solar model. If the numbers are disappointing, the gains we've seen recently could evaporate quickly.
The article Why Sunrun Inc's Shares Jumped 22% in April originally appeared on Fool.com.
Travis Hoium has no position in any stocks mentioned. The Motley Fool owns shares of and recommends SolarCity. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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