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The Zacks Analyst Blog Highlights: Solaredge, SunPower, First Solar and Vivint

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For Immediate Release

Chicago, IL – April 3, 2020 – announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Solaredge Technologies Inc. (SEDG - Free Report) , SunPower Corp. (SPWR - Free Report) , First Solar (FSLR - Free Report) and Vivint Solar Inc. (VSLR - Free Report) .

Here are highlights from Thursday’s Analyst Blog:

U.S. Solar Industry to Take a Hit in 2020: 4 Stocks in Focus

The year 2019 was a fairly successful one for the U.S. solar market, which witnessed installations of 13.3 gigawatts (GW) of capacity during the year, registering 23% annual growth. However, prospects in 2020 don’t seem favorable for the American solar market, thanks to the coronavirus outbreak and its impact on the economy.

Impact of Coronavirus on U.S. Solar Market

According to a report published by Solar Energy Industries Association (SEIA) earlier, total installed PV capacity in the United States was projected to rise 47% in 2020, with nearly 20 GW of new installations expected by the end of 2020. The projection now looks uncertain due to several factors that have emerged due to the coronavirus pandemic.

Of late, conditions across the U.S. economy have worsened, resulting in solar installers witnessing a sharp demand drop in installations. The economic slowdown will also be detrimental for the U.S. solar market, wherein solar product sales are likely to get affected by a halt in production, delivery delays and project cancellations.

Further, the U.S. solar market is expected to witness a severe blow in the coming months, as the virus outbreak has resulted in a ban on imports. As a result of this, the U.S. solar industry won’t be in a position to import Chinese solar components, which it heavily relies on.

With the impacts of the pandemic slowly mounting, growth within the solar industry has already taken a downturn. Consequently, we can see that the U.S. solar market has plunged 18.4% in the year-to-date period.

Expected Impact on Solar Market

Since China is the world’s largest solar module producer, disruptions caused by the virus outbreak in the supply chain have the potential to hit the global solar industry. This has forced analysts to lower their estimates for the solar market. Evidently, Bloomberg NEF revised down its recent global solar PV demand outlook for the year from the prior guidance of 121-152GW to 108-143GW, suggesting an 8% drop from the midpoint of the previously-provided guidance.  

Considering such a dismal outlook for the global solar market, we are skeptical about the solar market prospects for the United States, with the nation being one of the top five solar producers worldwide. In this regard, the SEIA announced that, without government support, some sectors of the U.S. solar industry might lose up to 50% of jobs. No doubt, such job losses reflect a sharp decline in project installations, which in turn will weigh heavily on the industry’s growth trajectory.

U.S. Solar Stocks Likely to Get Impacted

Considering the above-mentioned discussions, let us focus on the following four solar stocks, which are expected to witness some impacts of the pandemic on their operational performance. The stocks in focus are Solaredge Technologies Inc., SunPower Corp., First Solar and Vivint Solar Inc. Notably, shares of these solar companies have plunged on a year-to-date basis on account of the coronavirus impact.

Further, the Zacks Consensus Estimate for Solaredge’s 2020 earnings has declined 6.91% over the past 30 days. Similarly, estimates for SunPower, First Solar and Vivint Solar have also declined by 7 cents, $2.78 and a penny, respectively, over the past 30 days.

Such downward movements indicate analysts’ skepticism toward these stocks’ performance this year.
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