Solar energy prices are decreasing, and with oil and gas prices trending upwards, residential solar is becoming more attractive to the average American. Investors looking to build a position in this exciting market can look to Vivint Solar Inc. (NYSE: VSLR) for its potential as a future growth stock. Although a bargain today, there’s room for a short term upside and long term returns.
Vivint Solar is one of the largest solar installers in the United States. It has a unique operating model where it offers in-house financing to homeowners, which helps to offset the cost of installation. In exchange, the company enters a 20-year exclusivity agreement with the homeowner to supply any electricity that isn’t generated from the installation. This creates a long term revenue stream, ensuring security for the company.
Lower interest rates will be helpful for Vivint in 2020. Its financing will become more affordable to the average household. Analysts predict that the stock will reach $11.33 this year. Beyond that, prices could increase as solar becomes more common. This company has increased its sales revenue for five consecutive years, and it has generated a positive gross profit margin in the last three years. Not all solar players are profitable today, making Vivint even more attractive for bargain-minded investors.
- 1 Year Price Growth: 97%
- YTD Price Growth: 89%
- 3 Month Price Growth: 68%
All information is based on current and historical market data, as well as publicly available financial data. As with any financial decision, your own research is important. Stock market outcomes can never be 100% accurately predicted. Familiarity with historical data, individual industries, and individual stocks is key to developing a robust portfolio. Note that stock prices can fluctuate rapidly during trading sessions.