What happened

A very bullish new analyst take on solar stocks drove the prices of several industry names notably higher on Monday. On the back of that report, mentioned titles Sunrun (RUN 5.97%) and SunPower (SPWR 5.85%) both rose at double-digit rates. The former closed the day 12% higher, while the latter increased at a nearly 11% clip. Sunnova Energy International (NOVA 8.70%) didn't fly as high, but still managed a healthy 9% gain. 

With those performances, all three trounced the 0.4% bump of the S&P 500 index.

So what

The prognosticator publishing the report was Andrew Percoco of ever-influential investment bank Morgan Stanley. Percoco covered several top American solar stocks in his analysis, and among that grouping, his two preferred titles were Sunrun and Altus Power.

In his view, Sunrun is well on pace to hit the midpoint of its target for solar installations in the second quarter. The company had set a goal of 270 to 290 megawatts' worth of power. 

Zooming out, Percoco is rather optimistic about take-up of solar in the U.S. He is estimating that the market will increase by 15% this year over 2022. While he feels there will be a 10% pullback in 2024, that should reverse to a 10% gain the following year.

Naturally, this favors the larger-scale installers in the business. Sunrun is one of the potential beneficiaries, as is Sunnova and SunPower. However, Percoco trimmed his revenue growth estimate for the three as a group, to a year-over-year increase of 5% in 2024. His previous estimate was 10%. Among other factors, he cited a sluggish market in the Southeast U.S. as a reason for the downshift.

Now what

The Morgan Stanley analyst hasn't been the only pundit weighing in on solar stocks lately.

Last Wednesday, SunPower stock got a nice lift after Raymond James' Pavel Molchanov upgraded his recommendation on it, from outperform (i.e., buy) to strong buy, although he maintained his $21-per-share price target.

Molchanov felt that the stock was being unfairly punished by investors, who as a group were concerned about changes in California regulations regarding a change in net metering rules. Since California is a major solar market, both for the industry in general and SunPower in particular, many of those investors sold out of the company's shares.

"Ahead of an adverse policy change, there is always demand pull-in... this is followed by (for lack of a better word) a hangover... and then growth resumes from the lower baseline," the analyst wrote. "California is no exception."