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SolarCity Corp’s Residential Dominance Will Continue

In its first-quarter results, SolarCity (NASDAQ: SCTY  ) increased 2014 guidance to 500-550 MW and gave 2015 guidance of 900 MW to 1 GW, more than the entire country installed in 2013. Growing installations is one of the value levers SolarCity has at its disposal, and it's growing faster than competitors like SunPower (NASDAQ: SPWR  ) and NRG Energy (NYSE: NRG  ) . 

It's also important to keep an eye on retained value per watt, which was down slightly in the first quarter. As competitors enter the market SolarCity may have to compete more on cost than it did in the past. Keep an eye on this figure in the future because it's just as important as installation growth. 

In the video below, solar specialist Travis Hoium covers SolarCity's incredible growth trajectory and how investors should be looking at the company now. 

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Read/Post Comments (4) | Recommend This Article (3)

Comments from our Foolish Readers

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  • Report this Comment On May 25, 2014, at 5:08 PM, ronwiserinvestor wrote:

    "As competitors enter the market SolarCity may have to compete more on cost than it did in the past."

    That's an understatement! We blow SolarCity's pricing out of the water. In many cases our pricing is tens of thousands less than a $0 down solar lease.

    And as an added bonus, we offer $0 down solar loans that provide tax deductible interest. Solar City's lease and PPAs don't offer tax deductible interest.

    And we're not the only dealer out there that offers consumers a much better deal than SolarCity.

    There are thousands of us spread across the country. The age of much lower pricing and $0 down solar loans will rule this market in 2014 and beyond. Not the leasing companies.

  • Report this Comment On May 25, 2014, at 7:31 PM, JSergeant wrote:


    Your only activity on TMF seems to be to respond to Travis's articles about Solar City and talk about how Solar City's PPA agreement is more expensive than buying outright. I quote from your very first post:

    'A leased 4.75 kW system will typically cost the consumer $117.00 per month for a total cost of $28,080. The same purchased 4.75 kW system would cost the consumer $9,642 after applying the 30% federal tax credit. That's a difference of $18,438 wasted when you lease.'

    One thing you seem not to understand, is the time value of money. If I took that $9,642 and invested it at 7% for 20 years, it would be worth $37,312, so by my reckoning I would be about $9,300 better off with Solar City's plan than buying outright. And I've actually been achieving better than 7% returns for quite a number of years. Hence I went with a Solar City agreement.

  • Report this Comment On May 25, 2014, at 8:33 PM, ronwiserinvestor wrote:

    @JSergeant You conveniently failed to mention the value of having a nearly $0 electric bill for the 25 to 30 year life expectancy of a purchased solar system after a short 4 to 5 year return on investment, at today's sub $2.20 per watt after the ITC purchased system pricing.

    With exception of an inverter replacement ($1,000 to $1,500) at year 10 to 13 and possibly labor costs to remove and replace a solar panel or two that include a 25 year warranty, the LOCE of a modern PV solar system is extremely low.

    Add in the increased savings due to probable utility company rate increases and that LOCE shrinks even further.

    You'll never see nearly zero electricity costs with a $0 down solar lease or PPA because you're locked into a 20 year payment contract that many times includes a payment escalator that will increase you monthly payment by typically 2.9% per year, every year for 20 years.

    And YOU may be earning a 7% return on investment, but that is not the norm in today's market, so your 7% example is irrelevant in this discussion. There simply are no safe investments that yield a 7% return in today's volatile market.

  • Report this Comment On May 27, 2014, at 4:44 PM, impaler05 wrote:

    @ron - but again, much better use of that money can be made over the course of 30 YEARS!!! Ron, it doesnt seem like you will understand this concept.

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Travis Hoium

Travis Hoium has been writing for since July 2010 and covers the solar industry, renewable energy, and gaming stocks among other things.

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