Today we're going to take a closer look at Mid-Cap Technology company Sunrun, whose shares are currently trading at $18.72. We've been asking ourselves whether the company is under or over valued at today's prices... let's perform a brief value analysis to find out!
Sunrun Has an Attractive P/B Ratio but a Worrisome P/E Ratio:
Sunrun Inc. designs, develops, installs, sells, owns, and maintains residential solar energy systems in the United States. The company belongs to the Technology sector, which has an average price to earnings (P/E) ratio of 30.44 and an average price to book (P/B) ratio of 4.19. In contrast, Sunrun has a trailing 12 month P/E ratio of -1.7 and a P/B ratio of 1.45.
Sunrun has moved 61.5% over the last year compared to 12.8% for the S&P 500 — a difference of 48.7%. Sunrun has a 52 week high of $22.44 and a 52 week low of $5.38.
The Business Is Unprofitable and Its Balance Sheet Is Highly Leveraged:
| 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $859 | $922 | $1,610 | $2,321 | $2,260 | $2,038 |
| Operating Margins | -25% | -50% | -41% | -28% | -88% | -181% |
| Net Margins | 3% | -19% | -5% | 7% | -71% | -140% |
| Net Income (M) | $26 | -$173 | -$79 | $173 | -$1,604 | -$2,846 |
| Net Interest Expense (M) | -$174 | -$231 | -$328 | -$446 | -$653 | -$848 |
| Depreciation & Amort. (M) | $187 | $243 | $388 | $451 | $532 | $585 |
| Diluted Shares (M) | 124 | 140 | 205 | 219 | 217 | 222 |
| Earnings Per Share | $0.21 | -$1.24 | -$0.39 | $0.8 | -$7.41 | -$12.81 |
| EPS Growth | n/a | -690.48% | 68.55% | 305.13% | -1026.25% | -72.87% |
| Avg. Price | $15.62 | $35.45 | $52.9 | $25.93 | $19.63 | $18.65 |
| P/E Ratio | 67.91 | -28.59 | -135.64 | 31.62 | -2.65 | -1.46 |
| Free Cash Flow (M) | -$230 | -$321 | -$826 | -$867 | -$842 | -$767 |
| CAPEX (M) | $25 | $3 | $9 | $18 | $21 | $1 |
| EV / EBITDA | -137.89 | -39.79 | -61.08 | -64.37 | -10.07 | -5.34 |
| Total Debt (M) | $2,255 | $4,796 | $6,503 | $8,399 | $10,672 | $12,901 |
| Current Ratio | 1.38 | 1.26 | 1.53 | 1.82 | 1.26 | 1.29 |
Sunrun has declining EPS growth, negative cash flows, and High Levels of Debt. On the other hand, the company has rapidly growing revenues and decreasing reinvestment in the business working in its favor. Furthermore, Sunrun has just enough current assets to cover current liabilities, as shown by its current ratio of 1.29.
