SolarCity Corp (NASDAQ: SCTY)
SolarCity is having yet another strong day in the market today, and for good reason. The company has been the epicenter of quite a bit of good news recently, more of which was released this morning. This morning, it was announced that SCTY brought on an important new customer. Today, we’ll talk about who that customer is, other reasons to be excited about SCTY, and what we can expect to see from the stock moving forward.
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SolarCity Brings On A Big Customer
Early this morning, it was announced that SolarCity has brought on a new customer. So, who is that customer? Whole Foods! Whole Foods Market is looking for ways to save money. To do so, they are having SCTY install solar panels on several stores around the country. In fact, the company is looking for SCTY to install rooftop solar panels on 100 stores in locations like New York, Connecticut, and New Jersey. SolarCity has a bit of a task on its hands with this one as they will need to custom design each solar power system to maximize the amount of grid power offset. The project is said to be moving relatively quickly as well. In fact, SCTY plans on starting the installation this spring.
How The Market Reacted To The News
As investors, we know that any time there is positive news with regard to a publicly traded company, we can expect to see gains in the value of the stock associated with that company. That’s exactly what we’re seeing from SCTY today following the announcement of the Whole Foods Market installations. Currently (10:53), SCTY is trading at $25.25 per share after a gain of 4.39% or $1.06 per share thus far today.
Other Reasons To Be Excited About SolarCity
While the news that Whole Foods Market has hired SolarCity to install solar panels for the company is great news, it’s not the only reason to be excited about the company. In fact, it’s just one of many. Here are some of my favorite reasons to be bullish on SCTY:
- Changes In The Energy Industry – The energy industry as a whole has been undergoing some big changes. The reality is we’ve learned that the burning of fossil fuels leads to the release of greenhouse gasses, harming the global environment. As a result, we are seeing a big push from consumers, governments, and businesses alike to move toward renewable, clean energy sources like wind, water, and solar. This will ultimately lead to further increasing demand for SolarCity and other companies like it.
- Interest From Elon Musk – Elon Musk has been interested in SCTY for some time. In fact, he has held a stake in the company for years. Recently, however, it was announced that Musk has greatly increased his stake in SCTY, and that led to rumors that he may be looking to buyout the company and take it private. While I don’t think that the rumors have any validity to them, it is good to see a big money member of the board throwing more money into the company. After all, insider buying is usually a great sign.
- Tax Credit Extensions – One thing that was expected to hurt SCTY and other renewable energy companies this year was an expiring energy tax credit. The 30% tax credit was given to consumers and businesses that installed solar systems, leading to increasing demand. While it was expected to end in the beginning of 2016, it is now expected that the credit will last past 2017, giving bulls even more reason to be excited.
The Bottom Line
The bottom line here is that the stars are aligning perfectly for SCTY to climb and in a big way. The company is doing incredibly well in all facets of business and will likely continue doing so. So, if you want to get involved in a strong renewable energy opportunity, you may want to take a close look at SCTY.
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What Do You Think?
Where do you think SCTY is headed and why? Let us know your opinion below!
[Image Courtesy of Flickr]