Replies to post #51262 on SunWorks Inc (SUNWQ)

[Value_Fry22]

I'm a betting man and think that the ITC credit will get extended. Hopefully the prospect of it not getting extended shakes out some weak hands and provides even more value to buyers like myself. Obama will make sure it gets extended before his time in office is up.

[Value_Fry22]

Obama already is trying to extend the credit permanently in the 2016 Budget proposal along with increased solar funding in other areas. There are also other bills floating around that propose a 5 year extension.

[Intotheblack]

The ITC only affects demand for solar, therefore it will only "potentially" affect the top line of SLTD (unlike most other solars) and won't have any affect on the bottom line here unless there is a massive revenue fall off, which I really don't see.

Nelson's team has proven they can hit the bricks, and will continue to sell solar to those out there in the sweet size spot regardless of the ITC. Sure, the ITC is a great selling point, and will be a HUGE selling point this year, meaning revs and profits could potentially explode in 2016, as people jump in the solar pool before the credit "potentially" expires. However if it does expire, it simply means the break even timeframe is pushed out by at most 30%. So Nelson will have the team adjust loan rates and periods to make up a little ground, and continue to sell solar.

Also keep in mind the mix of res/com SLTD has. Off hand I recall Nelson saying 30% residential mix? So most of the sales are light commercial and agri. Which will only drop to 10% worst case, and according to this article (below) is still leaving solar viable in CA and several other markets.

Keep in mind, SLTD is different in that they don't get the credit, their customers do. So while SLTD can keep steaming along, pushing sales while cutting costs to combat the ITC loss, the "leasers" out there are going to be broken from it. Their new revenue streams will slashed and their losses will be staggering. At some point the market will realize SLTD is not like the leasers and will say, hey wait...they are making money over here. Shorts will get burned and long term investors will profit.

SUNE's meltdown is not helping anything solar right now, but it's creating a major buying opportunity in my eyes. Solar is going to have another explosive growth year, and investors everywhere are going to realize it at some point. ITC doesn't expire for another year. Which means 4 more Q's and March 2017 will show excellent times from 2016's books. That's where and when value traps will be created...leasers showing huge increases in 2016, and the ill-informed will be jumping in at the wrong time, not realizing they have missed the party.

http://www.greentechmedia.com/articles/read/What-Happens-When-the-ITC-Expires

Long