Sunrun Leads Solar Stocks Higher as Deutsche Bank Praises Strong U.S. Presence (NASDAQ:RUN)

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Sunrun (NASDAQ:CLASSES), Enphase Energy (ENPH), solar prime (NASDAQ:FSLR) and Sunnova (NOVA) all trading higher on Tuesday, +7.2%, +2.1%, +2.6% and +6.5% rin particular, after Deutsche Bank initiated coverage of solar stocks with buy ratingsciting their high exposure to US markets following the passage of the Inflation Reduction Act.

The current “favorable regulatory environment and improved incentive support should help further drive demand for the solar industry,” wrote Deutsche Bank’s Corinne Blanchard, noting that the U.S. solar market has plenty of room for growth, with only 4% of the total addressable market currently using solar panels; ETFs: (NYSEARC:TANNING)

On Sunrun (CLASSES), Blanchard noted its exposure to the U.S. residential solar market, which it believes is poised for strong growth trends as the Cut Inflation Act will further stimulate demand via tax credits. for any national content; she also cited the coupling of energy storage, which will become increasingly important and key for the acquisition of new customers.

Even with short-term challenges, the analyst likes First Solar (FSLR) strong backlog as the company is fully sold through 2025, and momentum will continue as demand for US-made, vertically integrated modules is strong.

Blanchard believes that about 15% of the market will be penetrated within 10 years, due to rising utility costs, falling solar costs and the benefits of the Cut Inflation Act.

The analyst also launched coverage of SunPower (SPWR) and SolarEdge Technologies (SEDG) with Hold ratings, citing concerns about SunPower’s exposure to weaker new home construction, and SolarEdge’s supply chain issues and cost pressure on currencies and shipping.

Solar names could also be boosted by Shoals Technologies strong third quarter results and guidance.

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