Tesla Inc. (NASDAQ:TSLA) and Sunrun Inc. (NASDAQ:RUN) have announced their decision to resume their rooftop panel selling business in Nevada. The decision was taken after legislators passed a bill, reinstating a policy the state had abandoned roughly 18 months ago.
Per 2015 policy, Nevada’s public utility commission gave the state’s only power company, NV Energy the permission to charge higher rates and fees from homeowners who have installed rooftop solar panels. This change in policy exhausted the rooftop solar industry’s business model, prompting Tesla’s subsidiary, SolarCity along with Sunrun to stop sales in Nevada.
Both Tesla and Sunrun will restart their business, once the bill gets signed by the state’s Governor, Brian Sandoval.
The new bill will ensure the sale of the excess power generated from customers' rooftop solar installations at near the full retail rate by electric utilities, rather than the almost one-third price they were entitled per the prior policy. In 2016, Solar installation jobs fell 32% in Nevada.
Currently, Tesla is focusing on its business and product portfolio expansion. It is developing heavy-duty trucks, to be named Tesla Semi, and a high passenger-density urban transport, i.e. minibuses. The company also plans to create an integrated solar-roof-with-battery product for which it acquired SolarCity.
Ahead, Tesla will lay significant emphasis on developing and refining self-driving technology. In the long run, it aims to offer car-sharing services on autonomous vehicles. With this set goal, Tesla will have a bigger product and services portfolio as well as diversified revenue sources.
Tesla is also actively undertaking mergers and acquisitions to meet its targets. The company completed the acquisition of Grohmann Engineering and expects it to play an integral role in reaching the increased production capacity goals. In addition, the company believes the acquisition of SolarCity to increase manufacturing efficiency and lower customer acquisition costs.
Price Performance
Tesla has outperformed the Zacks categorized Auto Manufacturers-Domestic industry in last six months. The company’s share price rose 79.8% compared with the industry’s gain of 7.8% during the period.
Zacks Rank & Stocks to Consider
Tesla currently carries a Zacks Rank #5 (Strong Sell).
Some better-ranked companies in auto space include Allison Transmission Holdings, Inc. (NYSE:ALSN) and Dana Incorporated (NYSE:DAN) . Both stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Allison Transmission has an expected long-term growth rate of 11%.
Dana has an expected long-term growth rate of 3%.
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Tesla Inc. (TSLA): Free Stock Analysis Report
Allison Transmission Holdings, Inc. (ALSN): Free Stock Analysis Report
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Sunrun Inc. (RUN): Free Stock Analysis Report
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