The stock market’s solar craziness gets cleaned out stock by stock, even as solar-power generation continues to soar.
By Wolf Richter for WOLF STREET.
Sunnova Energy International, which booked huge losses every single year selling residential solar energy equipment and services – $1.61 billion in total losses since 2017 – said on Sunday that it and its subsidiaries Sunnova Energy Corporation and Sunnova Intermediate Holdings, LLC, filed for Chapter 11 bankruptcy in Texas. Its subsidiary Sunnova TEP Developer had already filed for bankruptcy on June 1. In the filing, it said that it would continue operating as “debtor in possession” while trying to sell some of its assets under court supervision.
The marvel was of course its stock [NOVA] during the free-money pandemic. It went public in July 2019 at $12 a share and traded around $10 until the free money during the pandemic came along and caused the share price to spike five-fold to $55 by February 2021. That month, right at the peak, the Texas-based company acquired SunStreet from homebuilder Lennar, and Lennar washed its hands off it. Then the shares went to heck and were inducted into our pantheon of Imploded Stocks (minimum requirement: -70% from peak).
Shares last traded on Friday at 22 cents. The company said it expects to be delisted from the New York Stock Exchange and that holders of its shares “could experience a significant or complete loss on their investment, depending on the outcome of the Chapter 11 Cases” (data via YCharts).
During the years of losses, the company racked up $8.5 billion in debt, as per its last financial statement through December 31 – it failed to file its Q1 financials – amounting to over 10 times its 2024 revenues of $840 million.
In addition, the company had $2.1 billion in other liabilities, for total liabilities of $10.7 billion, as of its year-end financial statements.
Other solar stocks have collapsed as well. But solar power, in terms of electricity generation, keeps rocking higher.
Solar power generation surged 26.9% in 2024 to 303,167 GWh, utility scale and rooftop solar combined. This is not “capacity” but electricity generated and used. Solar’s share ballooned to nearly 7% of the total electricity generated in 2024, surpassing hydropower [my report with charts: US Power Generation by Source in 2024].
In addition, utility-scale batteries have become a profitable way of arbitraging the highly volatile electricity spot prices that can spike during high-demand hours and plunge during low-demand hours, often on the same day. In this arbitrage, batteries work well with big solar installations, buying electricity when the price is low, and selling it often just hours later when the price is high. And batteries work well with small-scale solar too. Some of the solar companies here are involved with both solar power and energy storage.
There are up-front costs with solar power, as there are with every power plant. When it comes to energy, there are no free lunches. But with solar, the “fuel” is free for the life of the installation, and the math has been getting better as the price of photovoltaic panels has come down over the decades.
Big utilities are all over solar power, as are big equipment providers, such as Tesla. But these eight Imploded Stocks here are specialized players, many of them with over 1,000 employees at the peak, and with hundreds of millions to several billion in annual revenues.
Stock market solar craziness.
SunPower is already a goner. It filed for bankruptcy in August 2024. Most of its assets were acquired by solar SPAC Complete Solaria for $45 million (more in a moment), and SunPower’s shares got wiped out.
One of the early solar big boys, it went public in 2005 as a spin-off from Cypress Semiconductor. Its stock experienced two bubbles: #1 in 2006-2007 when it went from $20 a share to $100; and #2 during the free-money pandemic when the stock multiplied by 12, from $4 a share to $54. In the end, it was felled by a toxic mix of operational issues, years of losses, accounting issues, missed filing deadlines, defaults, etc. (data via YCharts).
Complete Solaria [SPWR], which acquired SunPower’s assets, had gone public via merger with a SPAC in July 2023, as a residential solar systems provider. After the acquisition, it started doing business as SunPower and changed its ticker to SunPower’s former ticker SPWR.
Since the SPAC-merger, the stock has plunged by 82% to $1.93 today.
SolarEdge Technologies [SEDG], which makes inverters, batteries, power optimizers, and other equipment for solar systems, went public in 2015 via IPO amid a deal with Tesla Energy to provide inverters for Tesla’s Powerwall. But eventually, Tesla produced its own inverter. And that was that.
The company, headquartered in Israel and largely active in Europe, became sort of a rollup acquiring companies in Korea (Kokam), Italy (SMRE), and the UK (Hark Systems).
In 2024, it lost $1.8 billion, dwarfing the little bitty income it had booked in prior years. And sales collapsed by 70% in 2024.
What’s notable is the stock price, which had multiplied by 10 between early 2019 ($36 a share) and January 2021 ($360 a share), before collapsing by 95% to $18.72 today:
Sunrun [RUN], a residential solar systems installer based in San Francisco, went public via IPO in 2015, and over the past five years, lost $4.5 billion, including $2.85 billion in 2024.
The stock had multiplied by 11 between April 2020 ($8.36) and January 2021 ($96.50), but then collapsed and today closed at $8.27. Maybe investors should have taken the ticker literally?
Enphase Energy [ENPH], which makes equipment for residential and business solar and storage systems, and also EV chargers, went public via IPO in 2012. But then in 2019, stock took off and eventually, fueled by the free-money pandemic, multiplied by 48, to $336 in December 2022. Today, it closed at $43.26, down by 86% from that high.
The company has been profitable, but revenues collapsed by 42% in 2024, to $1.33 billion.
Shoals Technologies [SHLS], maker of equipment for solar systems, including utility-scale systems, went public via IPO in January 2021 at $25 a share, spiked to $40.17 within a few weeks, and then tanked, and closed at $5.10 today, down by 87%.
The company had been mildly profitable in recent years, but annual revenues plunged 18% in 2024 to $399 million.
Array Technologies [ARRY], maker of ground-mounting systems for solar installations, went public via IPO in October 2020, at $22 a share and quickly rose $51.01 in January 2021, before it kathoomphed.
The IPO during the free-money pandemic raised over $1 billion amid huge demand for the shares. It was also when PE firm Oaktree Capital, which had backed Array, began dumping its shares at peak prices.
Annual revenues have plunged by 44% over the past two years, to $915 million in 2024, and it lost $240 million last year. The stock has now plunged by 85% from the January 2021 high, to $7.49.
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“Its stock experienced two bubbles: #1 in 2006-2007 when it went from $20 a share to $100; and #2 during the free-money pandemic when the stock multiplied by 12, from $4 a share to $54.”
You know we’re in the golden age of scam and hype, when one bubble just isn’t good enough. Give it sometime, maybe 3rd time the charm, after a rebranding/name change exercise perhaps..
Btw, pretty sure SolarCity would be at the tip top of this list if it wasn’t for a famous rich cousin that bailed them out…
‘we’re in the golden age of scam and hype,’
And these outfits actually had a product. The coming, guaranteed Crypto Crash will dwarf their flame out. Prediction: CNBC will rue the day it ever started quoting these ‘assets’ along with oil, copper, gold, etc.
The debt added to the US debt pile is going straight to markets. Crypto (and stocks) won’t stop going up until the debt is reined in. Too many dips have been successfully bought since 2009, so it’s gonna be incredibly hard to bring these down.
That doesn’t mean I’m asking you to buy them here; just saying it’s a hardened bubble. Powerful people are now invested in crypto so they will support the scam.
Seems odd to me that every high point is around 2021. Downhill from there. All of these charts should be published in supposedly official financial news reports! Would wager they will be covered up and never published anywhere except here.
A pretty amazing phenomenon: the run-up when a new technology becomes the hot sector and is followed by the deflating baloon flying around the room as the hype sells off.
If it was a mis-guided rally, everyone’s hurting. If it was a legit sector with wild upside, it’s still a shrimp-storm until the 1 or 2 companies in that sector that are the eventual world-beaters in that particular tech area emerges.
Everyone’s right about renewable energy as a growing solution, but the world-beater is probably the highly unpopular company that starts with a T. Sorry haters.
Only unpopular to the many that are unfit mentally.
Storage and production are two different things.
The company that starts with a T isn’t really in the renewable energy sector. They do have a roofing product that is seriously underperforming and hasn’t gotten much traction thus far. While they are making a storage product, the bulk of their batteries have come from Panasonic and LG, but they are starting to manufacture their own in Texas. The top storage provider by volume in the US is NextEra and while the company that starts with T is a global leader in volume, BYD is right behind them and breathing down their neck. As with electric vehicles, there are enough alternative choices that the company starting with T isn’t guaranteed to be in the catbird seat for long.
It would be interesting to go back and look at the analysts who pushed these stocks back when they were high flyers. Also to view the few who despised them. See where they are today.
Who got all this “free money” and spent it on stocks?
No, I haven’t invested any money, other than what I paid to have my system installed. But, be that as it may, my Enphase Energy system has been working like a champ since 2018.
And that is Slim’s unpaid endorsement.
Thanks for that article. Diversity in articles is great her. I have been following these green energy SPACs a bit since the first bubble.
The big trend here is people being sold these stocks as if the companies didn’t provide common commodities. You can buy a micro inverter equivalent to Enphase for 1/4th the price from china. Great products but still a common appliance. My neighborhood electrician designs and installs solar systems. They are not exactly complicated.
We installed our solar and battery back-up system in March. We typically generate more power than we use. We sell our excess production to Duke Power…and, our battery is fully charged at the end of each day.
We paid $48k for the entire system. We received a tax credit of $15k and a payment of $9k from Duke Power in exchange for limited battery control.
But the beautiful part is that our newly constructed house was designed with a plan for rooftop solar. Can’t see a single panel from the curb.
If these electricity use projections (related to AI) come true, this solar installation will be a fantastic investment.
Still early on. Wait another 8-13 years, and the odds are your system will probably not be doing so well. You could be a lucky one whose system keeps going well, but many rooftop solar systems tend to start having problems after about 15 years.
What’s the story with the rapidly collapsing revenues in 2023 and 2024 – were deal-crucial tax benefits/credits removed?
And what happens to home-use and grid-feed systems if the installer companies have gone BK? Will in-home and grid-feed systems still work or are they now inoperative junk?
California changed their rate structure for solar (Net Energy Metering 3.0) making it a less attractive proposition and CA is the largest solar market in the country. There were a ton of predictions at the time that the change would put a lot of solar companies out of business.
Much like electric vehicles, there’s a limit to the number of potential customers. The cost has to pencil in both payback and public display of lifestyle choices.
Could call these Icarus stocks
That sure comes to mind every time.
Looking at you TSLA
Only “fossil fuels” are viable energy. If anything else was, EVERYONE would be using it. Nuclear is making a comeback and hopefully bridges the gap, and batteries could help when the technology matures, but Fusion will be the game changer.
The cheapest most reliable energy source by miles is hydro-electric.
It is also renewable. The sun’s energy evaporates the water to fall as rain upstream, which is then harnessed running downstream.
Quote Wolf : Solar power generation surged 26.9% in 2024 to 303,167 GWh, utility scale and rooftop solar combined. This is not “capacity” but electricity generated and used.
Trouble with home roof top solar is that much of the energy is generated when there’s nobody there.