Earnings Miss: Sunrun Inc. Missed EPS By 58% And Analysts Are Revising Their Forecasts

It's been a mediocre week for Sunrun Inc. (NASDAQ:RUN) shareholders, with the stock dropping 17% to US$17.13 in the week since its latest quarterly results. Revenue came in at US$725m, beating expectations by a remarkable 21%, while statutory earnings per share (EPS) were US$0.06, missing estimates by an equally remarkable 58%. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

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Taking into account the latest results, the most recent consensus for Sunrun from 20 analysts is for revenues of US$2.53b in 2026. If met, it would imply a notable 9.0% increase on its revenue over the past 12 months. Sunrun is also expected to turn profitable, with statutory earnings of US$0.57 per share. In the lead-up to this report, the analysts had been modelling revenues of US$2.45b and earnings per share (EPS) of US$0.81 in 2026. So it's pretty clear the analysts have mixed opinions on Sunrun after the latest results; even though they upped their revenue numbers, it came at the cost of a pretty serious reduction to per-share earnings expectations.

View our latest analysis for Sunrun

There's been no major changes to the price target of US$21.66, suggesting that the impact of higher forecast revenue and lower earnings won't result in a meaningful change to the business' valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Sunrun at US$30.00 per share, while the most bearish prices it at US$14.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that Sunrun's revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 7.2% growth on an annualised basis. This is compared to a historical growth rate of 13% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 11% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Sunrun.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, they also upgraded their revenue estimates, although our data indicates it is expected to perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Sunrun going out to 2027, and you can see them free on our platform here..

Plus, you should also learn about the 3 warning signs we've spotted with Sunrun (including 1 which is a bit unpleasant) .

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.