Residential solar firm Sunrun (NASDAQ: RUN), part of BlackRock’s (NYSE: BLK) portfolio, has been hit with a devastating Wall Street downgrade that effectively renders the stock worthless.
Specifically, GLJ Research slashed its rating to ‘Sell’ and set a price target of $0.01, implying a staggering 99% drop from its last closing price of $9.64. By press time, RUN was trading at $5.58, down 42% for the day.
Why RUN stock was downgraded
The downgrade follows the introduction of a revised Senate tax bill, which GLJ argued poses a major threat to Sunrun’s future growth.
The bill, backed by Republicans, proposes phasing out solar and wind tax credits by 2028, marking a broader shift away from green energy under the Trump administration.
While hydro and nuclear will receive extended support through 2036, solar will face an uncertain future.
According to GLJ, Sunrun is spending over $640 million annually to maintain its installed systems. Critically, the firm warned that once-lucrative tax credits tied to leased and power purchase agreement (PPA) models are drying up, leaving Sunrun with no clear path forward.
The ripple effects could extend across the solar sector. Equipment suppliers like SolarEdge (NASDAQ: SEDG) and Enphase Energy (NASDAQ: ENPH) may also come under pressure if demand stalls.
By contrast, GLJ noted that First Solar (NASDAQ: FSLR) could emerge as a winner. Under the proposed legislation, its production tax credits remain intact, preserving its long-term growth prospects.
Notably, the GLJ downgrade comes just months after BlackRock (NYSE: BLK) reduced its stake in Sunrun.
As of March 31, 2025, the asset manager trimmed its position by 4.8 million shares at an average price of $5.86, lowering its stake to 16.3% of its portfolio, though it still holds 36.8 million shares.
Featured image via Shutterstock
