Why SolarCity's Shares Plunged

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of solar installer SolarCity (NASDAQ: SCTY  ) fell 14% today after reporting earnings.

So what: During the fourth quarter, revenue grew 22%, to $25.2 million, but fell well short of the $38.3 million analysts expected. The company also reported a loss of $1.10 per share, which far exceeded the $0.43 loss that Wall Street expected.  

Now what: The big question for SolarCity is; When will it make a profit? This quarter didn't ease any fears investors had and, with shares trading at double the IPO price, expectations have gone up in recent months. I'd take a "wait and see" approach with SolarCity, because there's no indication it can control operating costs and grow sales enough to generate a profit for shareholders.

Interested in more info on SolarCity? Add it to your watchlist by clicking here.


Read/Post Comments (1) | Recommend This Article (4)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On March 07, 2013, at 9:29 PM, ronwiserinvestor wrote:

    Maybe that's because consumers across America are beginning to realize that it's far less costly to buy a solar system and keep the 30% federal tax credit and cash rebate than it is to give all of your incentives away to some leasing company while paying more for your solar system.

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2300822, ~/Articles/ArticleHandler.aspx, 9/22/2014 2:21:01 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement