SolarCity Corporation (O:SCTY)
SolarCity has had a rough start to the year. However, the stock isn't alone. Unfortunately, no matter where you look in the market, chances are that you're seeing red. However, the most successful investors say that when fear is high, it's time to buy. If you're looking for a stock to get involved in at the moment, you may want to take a strong look at SCTY. Recently, we've heard several bits of news that will likely impact demand for renewable energy systems. Not to mention, SCTY recently launched a new referral program that will allow the company to take a large chunk of the growing demand in the industry. Today, we'll talk about that referral program, other factors that are likely to lead to high demand for SolarCity systems, and what we cane expect to see from the stock moving forward.
SCTY Launches A National Referral Program
The new referral program comes with the name SunRaising. The idea is to raise funds for nonprofit organizations while giving more people a reason to get involved in solar. Under the program, when new businesses or consumers sign up to have solar systems installed, SolarCity will done $200 to an organization the new customer supports. In addition, for homeowners who sign up through the program, the first month of power is free from SCTY as a thank you gift for supporting local organizations.
The only kicker here is that the nonprofit organizations have to enroll. Currently, the program offers donations to more than 100 nonprofits, including food banks, booster clubs, hospitals, schools, community centers, and recreational groups. In a statement, Paul Galla, President of one of the enrolled nonprofits in the SCTY SunRaising program, Riverkeeper, had the following to say...
Solar is both viable and economical for most home and business owners in New York and can play a large role in protecting one of America's greatest rivers, the Hudson.... One of the greatest threats to the Hudson is an aging nuclear power plant so, not only does SolarCity lower New Yorkers' energy bills, but when consumers opt for solar, it plays an integral part in replacing the power from this harmful plant and others like it.
Other Factors That Are Likely To Lead To Stronger Demand
While the SunRaising program put together by SCTY is a strong one, it's not the only factor that's likely to raise the demand for the company's products. In fact, we've seen a couple big stories as of late that revolve around the renewable energy space. Here they are...
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Paris Climate Change Deal – In December, Paris reached a landmark climate change deal with 195 countries. Under the deal, the countries have agreed to work to reduce greenhouse gas emissions. To do so, they will have to reduce their reliance on fossil fuels, creating a higher demand for renewable energy companies like SCTY.
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Federal Tax Credit – For years, the United States has offered a 30% federal tax credit to businesses and consumers that make the decision to install renewable energy systems in their home or office. However, this credit was expected to come to an end at the beginning of 2016. Nonetheless, the US government has made the decision to extend the tax credit, also helping to bump up demand for SCTY and the renewable energy industry as a whole.
What We Can Expect To See Moving Forward
The answer really depends on how far forward you plan to look. In the short term, market conditions are likely to remain relatively negative. As a result, SCTY is likely to feel the pressure. However, bear markets don't last forever, and when this one is over, SCTY is going to climb. All in all, I have a very bullish long term outlook with regard to what we can expect to see from SolarCity.