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SolarCity beats by $0.03, misses on revenue

  • SolarCity (NASDAQ:SCTY): Q2 EPS of -$0.96 beats by $0.03.
  • Revenue of $61.33M (+61.6% Y/Y) misses by $1.91M.
  • Press Release
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Comments (17)
  • cmnsnse
    , contributor
    Comments (881) | Send Message
     
    Fantastic quarter. Lease/ppa is growing, massive YoY growth here. Only reason total revenue was down because cash sales are decreasing. The guidance reflects even greater lease/ppa growth and further cash sales decrease.

     

    Every important metric was met and exceeded. Sorry shorts. When investors get done sifting through the real numbers, this is only going up...
    7 Aug 2014, 04:32 PM Reply Like
  • TheBanker
    , contributor
    Comments (1342) | Send Message
     
    Give us more info than that. What was good about the report other than coming in better than .03. I haven't studied it too well just yet. I'm going to listen to the CC later.
    7 Aug 2014, 04:46 PM Reply Like
  • cmnsnse
    , contributor
    Comments (881) | Send Message
     
    Banker,

     

    Retained Value went to 1.72/watt from 1.56/watt... smash

     

    opex/watt decreased from .48/watt to .45/watt... fantastic

     

    Bookings are now above the run rate they wanted to EXIT 2014 with @ 218MWs(136MWs booked last quarter) puts them at an annual run rate of 872MWs already, which implies they are pretty much booked out through 2015 right now at the 900MW-1GW guidance... SMASH X2

     

    Leases/ppa are not slowing down but INCREASING MASSIVELY which is counter to all the media press. Cash sales are going in the opposite direction. Look at the income statement and you'll see why revenue is down. Also tells us ABS with be VERY STRONG for a long long while to come... confirmation they are gonna have a steady flow of the lowest cost capital available for years now.... SMASH

     

    Conference call now.... Tanguy Serra is a very strong presence... wow
    7 Aug 2014, 05:02 PM Reply Like
  • TheBanker
    , contributor
    Comments (1342) | Send Message
     
    stock moved up nicely after cc. I have to listen to it now if I can find it.

     

    Do you know if the waiting list is getting longer for a system? I'm just curious if the backlog for panels is growing. That's something positive for me but some will view that as a negative. If people are willing to wait for panels then that's a plus. It means they are really beating the competition in a big way.

     

    Did they mention what $ are lease vs. sales before/after this quarter? Just curious how much that improvement is on a % basis.
    7 Aug 2014, 06:50 PM Reply Like
  • cmnsnse
    , contributor
    Comments (881) | Send Message
     
    Banker, they booked 218MWs last quarter... this is a blockbuster waiting line around the block... gigantic. They will easily meet 900MWs-1GW goal in 2015. Also, Lyndon affirmed his confidence with 1 million customer goal by 2018... they increased customers by 30K last quarter... bigger then they expected, now at 140K customers... remember they were at 83K customers at the start of the year... really strong demand... can't wait to see the market share numbers when they come out...

     

    Listen to the conference call on the investor website. A LOT of big info was put out.

     

    Factory will be up and running at 1GW rate by end of 2016. Install costs to drop down to 1.90/watt by that time... meaning they will be able to continue compounding growth through the ITC reduction to 10%.

     

    Also hinted at much much more, like the next ABS could be $250mln and the after that @$300mln level.
    7 Aug 2014, 07:11 PM Reply Like
  • TheBanker
    , contributor
    Comments (1342) | Send Message
     
    I'm about halfway through the cc recording now. I'll listen to it again later. I'm sure I missed some things. He definitely says we're on track for 1M customers. It looks like ZEP is really paying off for them. Less than 1 day to do an install now.

     

    What percentage of the business for the quarter was lease vs. purchase? I haven't heard that info anywhere or seen anything in print that would help figure that number. I'd like to see the % of leases climb. Market share is important too. Last I knew it was 32% sometime earlier this year.

     

    The ITC isn't going to slow down solar and you never know, it might not even go away. It's not something I'm concerned about.

     

    ABS will definitely keep rising. I think I heard something about 98% of their revenues were collected and BBB+ rating so there is almost no default on payments at all. 2% is probably = utility companies.
    7 Aug 2014, 07:27 PM Reply Like
  • cmnsnse
    , contributor
    Comments (881) | Send Message
     
    For the mix, look at the revenue. Lease/ppa revenue is going up, sales revenues going down. Next quater they forecast only $8mln from sales, so drastic shift toward lease/ppa...
    7 Aug 2014, 07:36 PM Reply Like
  • TheBanker
    , contributor
    Comments (1342) | Send Message
     
    Yes, but is the lease/ppa revenue TOTAL lease revenue from all previous quarters or just this past quarter? I'm trying to figure out what % of installs for this past quarter was lease. As long as it's over 60% that's great, but if it's actually climbing that is awesome. We need that number for Ron.
    7 Aug 2014, 07:41 PM Reply Like
  • cmnsnse
    , contributor
    Comments (881) | Send Message
     
    They've never broken that down, but next quarter forecast is for only 8mln is sales... It was $18mln this past quarter, so lease ppa is seeing most of next q rev.

     

    The sales numbers are decreasing, so the mix is well above 60%. More like 90%+. To give more perspective on bookings... They booked more MWs in Q2 they installed the entire year in 2012. If the trend continues, they could more MWs in Q3 then they installed in all of 2013. It's just wild growth...
    7 Aug 2014, 08:04 PM Reply Like
  • TheBanker
    , contributor
    Comments (1342) | Send Message
     
    They are researching loans and Rive was excited about it. They are keeping it a secret. It would be great if it ends up shutting down more of the competition. 60+ days wait to get an install now and that number is shrinking. It will be awesome when they get it down to 30.

     

    The stock was up $3 in AH trading. I think when it opens tomorrow there is going to be some crazy action. With it being Friday I think the gains will be limited to the morning pop but I'm still buying more anyways. $88 is an easy target for the next 30 days assuming we don't end up in a war with Russia.
    7 Aug 2014, 08:20 PM Reply Like
  • cmnsnse
    , contributor
    Comments (881) | Send Message
     
    He said they won't roll out the loan program until it's the best one on the market, so it will eat all the other market share that loans are getting.

     

    Honestly, I still think a majority of people will chose lease/ppa even with the loan product out there. Mass market is a different animal all together compared to early adopters. They won't want to deal with any extra thought, work, or worry. They've never had to worry about before with utilities and it's that way for reason. Leases/ppa are the most worry free solution. Just my opinion.
    7 Aug 2014, 08:40 PM Reply Like
  • TheBanker
    , contributor
    Comments (1342) | Send Message
     
    As a banker I see that the average person lives in their home 7 years and I bet a lot of them see this as an upgrade they will never see a ROI on. So if you buy a $20k system after taxes they don't believe it's adding $20k in value to the home on day 1. So if they move in 2-3 more years after that purchase they feel they are likely not breaking even. It's a purchase risk no doubt. I wish more SCTY customers owned the stock and commented here. We all have money so of course many of us would buy. We're all risky investors so we take risks. I want to hear from more people who hate risk. Those are the people who lease. They live paycheck to paycheck with no cash in the bank. I see those people all the time. They are doctors, lawyers and engineers alike. Big money, bigger problems. Not everyone with a nice paycheck has money in the bank for a cash purchase, many refuse to take on a loan and those are the people leasing.
    7 Aug 2014, 08:45 PM Reply Like
  • cmnsnse
    , contributor
    Comments (881) | Send Message
     
    Egos will now destroy pocket books... perfect short squeeze shall commence...
    7 Aug 2014, 06:36 PM Reply Like
  • Hendershott
    , contributor
    Comments (1621) | Send Message
     
    Nothing mixed about the quarter. This myopic reporting of earnings minutiae ("missed by $.02, missed on revenue by $2MM" for example) ,type of reporting is unhelpful. No analyst can precisely predict a company's earnings or revenue. The CEO's can't do it either. Company does $60MM or so in the quarter and "misses by $1-2 MM. pretty useless info. Not just SCTY, and not just SA, but all these reports. SA (and everyone else) needs more depth in reporting earnings. The Street.com is probably the worst of the bunch, churning basically computer generated pablum that mostly has nothing to do with the actual report.
    7 Aug 2014, 08:28 PM Reply Like
  • TheBanker
    , contributor
    Comments (1342) | Send Message
     
    There is more behind the scenes with SCTY that we are here to talk about. If you don't look at 10 different things in the earnings report you're not paying attention. CMNSNSE is on top of the numbers. I need to keep them in a spreadsheet myself. Reading the earnings report is a challenge. I'm a numbers guy so all their mumbojumbo is confusing but I understand the hard numbers the best.

     

    The company is growing by leaps and bounds. The leasing model is getting stronger, not weaker. The ABS are getting bigger and cheaper. The installs are faster and cheaper. The retained value is rising while costs in general are falling. The acquisition rate (cost) is dropping. Waiting for the install is down to 60 days.

     

    If you bought or sold based on 99 cents or 96 cents you're just a fool. If you pay attention to insider selling you're an even bigger fool.
    7 Aug 2014, 08:33 PM Reply Like
  • cmnsnse
    , contributor
    Comments (881) | Send Message
     
    Also think from institutional investor perspective. 99% of lease/ppa payments come in each month... Single safest bond investment out there today... It is going to be a feeding frenzy for ABS offerings. Secondly, the institutions can short/long the stock for years to come on the compounding growth. They can make money off this thing in every way possible.

     

    We haven't even come close to how big this going to get soon...
    7 Aug 2014, 09:21 PM Reply Like
  • TheBanker
    , contributor
    Comments (1342) | Send Message
     
    Why would the institutions want to short this stock? They don't move in and out as quickly as most traders.
    7 Aug 2014, 09:30 PM Reply Like
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