Higher-for-longer interest rates could slam key solar energy stocks, according to Truist. The firm downgraded solar panel installers SunRun and Sunnova to hold from buy in a Wednesday note, and lowered its price targets to $12 and $11, respectively, from $30 and $35. Truist now forecasts roughly 13% upside for SunRun and 17% for Sunnova.
Bond yields have soared in recent days, with the benchmark 10-year Treasury yield reaching levels not seen since 2007. "While we believe NOVA & RUN will continue to take share given their strength in TPO [third-party owner] financing, equity price response post 2Q results makes it clear to us that the market is no longer rewarding outsized growth while companies continue to compete in the 'land grab' U.S. resi space.