The company reported a loss of $2.10 per share, which was behind the analysts’ estimate of $1.91.
Advertisement
In the reported quarter, total deployment was 205 megawatt (MW), up 49.6% bringing the total installed capacity to 1,594 MW as of Sep 30, 2015.
During the quarter, SolarCity added 35,535 customers to its portfolio. Oppenheimer also lowered their SCTY target to $58 from $66, noting the company is preparing for a modest growth environment post fiscal 2016.
CTRL was down $2.33 at $6.61 in midday trade, moving within a 52-week range of $5.99 to $16.75. The company guided EPS lower for next quarter to a range of -$2.60 to -$2.75 vs. estimates of -$2.51.
The company had previously expected installation of 920-1000 MW. This is mainly because weather conditions may slow work, especially on commercial rooftops in the U.S. Northeast.
2016: SolarCity expects to achieve positive cash flow by 2016 end and be in solid shape prior to the planned ITC expiration in 2017. In a report issued on October 26, Robert W. Baird also maintained a Buy rating on the stock with a $68 price target.
So what: SolarCity’s earnings included a much larger GAAP net loss than the market was expecting, despite solid growth numbers in revenue and solar systems installed, and a pretty big drop in its cost-per-watt metric, which factors in how much it spends on the business for every watt of power production it installs.
Two major milestones were accomplished by the company.
SolarCity began offering systems to small businesses during the quarter and acquired a developer in Mexico in its first worldwide expansion. Results were negatively impacted by a $5.3 million charge ($0.06 per common share) for lower of cost or market inventory adjustments, a $0.4 million charge ($0.01 per common share) related to the closure at Ravenswood, a $1.4 million charge ($0.02 per common share) related to the labor disruption at Hawesville, a $2.9 million charge ($0.04 per common share) related to the partial curtailment at Hawesville, and a $1.2 million charge ($0.01 per common share) related to severance primarily associated with cost reductions. Secondly, SolarCity became the first solar company to reach 1 GW in distributed solar installations in the US.
Advertisement
Having said that, one can not ignore the fact that the company has failed to earn profits for 12 consecutive quarters while its operating expenses have risen significantly. Currently, SolarCity has a Zacks Rank #3 (Hold), but it is subject to change following the release of the company’s latest earnings report. Today, you can download 7 Best Stocks for the Next 30 Days.
