Category Archives: stocks

SolarCity Q1 Demand Nipped By Rivals Sunrun, Vivint Solar

No. 1 residential installer SolarCity ( SCTY ) lagged rivals Sunrun ( RUN ) and Vivint Solar ( VSLR ), as March solar applications in California declined year over year, while the entire segment trailed triple-digit commercial growth, a Credit Suisse analyst said Thursday. Credit Suisse analyst Patrick Jobin’s report follows SolarCity’s Q1 earnings, released late Monday. SolarCity stock was blistered this week on Q2 guidance that missed views, while its 2016 installation outlook  was cut on Q1 bookings that fell 150 megawatts flat. Sunrun is slated to report its Q1 earnings late Thursday. In midday trading on the stock market today , SolarCity stock was down 1.5%, after its shares dove 21% on Tuesday in reaction to the company’s earnings report. Sunrun and Vivint stocks were down 3% and 1%, respectively, midday Thursday. SolarCity’s “horrendous” bookings and weak guidance appear to be self-inflicted, Jobin wrote in a research report. “We do see modest growth decelerating in California but note that all growth is not gone,” he wrote. “Sunrun, who reports this afternoon, appears to have fared better in Q1.” For Q1, Sunrun is expected to report $87.7 million in sales, down 12% quarter over quarter, and a 48-cent per-share loss minus items, widening from a 15-cent loss in the previous quarter. SolarCity and Vivint each reported March-quarter losses this week. Excluding Nevada — which accounted for 12 MW in Sunrun’s backlog — Q1 deployments are expected to be flat sequentially. SolarCity and Sunrun exited Nevada in December when regulators cut net-metering payments to solar customers. In March, SolarCity’s residential applications fell 8% year over year vs. 17% and 23% growth from Sunrun and Vivint, respectively, Jobin wrote. Total residential applications for 73 MW of solar to utility companies grew 14.5% vs. last year. The commercial segment was the main driver in March, where 41 MW in total applications were up 136% year over year. Third-party ownership also picked up in March, reaching 62% of all residential applications vs. the 60% average for the second half of 2015.

Broad Security Freeze: Palo Alto Demand Stalls; Q2 Views Lukewarm

Palo Alto Networks ( PANW ) stock tumbled Thursday after a Piper Jaffray analyst said that lackluster April demand and Q2 guidance from Check Point Software Technology ( CHKP ), FireEye ( FEYE ) and Imperva ( IMPV ) could signal a broad cybersecurity slowdown. IBD’s 26-company Computer Software-Security industry group is down 18.5% for the year after toppling 32% through Feb. 9, on bleak guidance for IT spending from firms like LinkedIn ( LNKD ) and Tableau Software ( DATA ). Barracuda Networks ( CUDA ), Check Point, FireEye and Fortinet ( FTNT ) recently missed full-year views. Imperva and Proofpoint ‘s ( PFPT ) Q2 outlooks lagged the consensus. Now, channel checks show April demand slowed, Piper Jaffray analyst Andrew Nowinski says. “The key takeaway from Q1 earnings season is that the security sector is starting to show signs of slowing based on the guidance that was provided for Q2 and fiscal 2016,” he wrote in a research report Thursday. Cybersecurity stocks toppled Thursday on Nowinski’s assessment. IBD’s security group was down 2% in morning trading on the stock market today , with Palo Alto Networks and FireEye stocks leading the deluge, down a respective 6% and 4%. Palo Alto Networks stock was at a two-month low, near 130. IBD’s Take: How does Palo Alto Networks stack up, and how does it compare to its rivals? Find out at IBD Stock Checkup But some analysts say Palo Alto Networks could beat guidance when it posts fiscal Q3 earnings on May 26. The company has topped the high-end of its outlook by an average 5.6% for the past 11 quarters. To do so again, Palo Alto would have to report $356 million in sales. The consensus of 43 analysts polled by Thomson Reuters models $339.4 million in April-quarter sales, which would be up 45% vs. the year-earlier quarter. But $549.5 million in July-quarter billings expectations, up 40%, might be too aggressive, Nowinski wrote. During the April quarter, some delays in large contracts likely hurt Palo Alto Networks, Nowinski wrote. “Most (resellers) thought it was simply due to a ‘digestion period’ where customers were still trying to integrate products they purchased in 2015,” he wrote. “The results definitely indicate demand slowed sequentially and also on a year-over-year basis.” Nowinski expects Palo Alto Networks to at least meet estimates, but he cut his price target on Palo Alto Networks stock to 180 from 208. He reiterated an outperform rating, but wrote that “this is the first quarter in at least two years where we picked up any sort of slowdown in Palo Alto’s demand trends.”

Court Ruling On Open Internet Imminent For Comcast, Verizon, AT&T

A federal appeals court could hand down a decision any day on the Open Internet Order — also called “net neutrality” — rules opposed by Internet service providers such as AT&T ( T ), Comcast ( CMCSA ) and Verizon Communications ( VZ ). The U.S. Court of Appeals for the District of Columbia Circuit typically releases decisions on Tuesdays and Fridays. Telecommunications, cable and wireless industry trade groups have challenged the Federal Communications Commission’s authority to enforce rules for an open Internet . In separate cases, Verizon and Comcast have successfully challenged earlier FCC net neutrality rules. A ruling from “D.C. Circuit 3” appeals court had been expected as early as April. The three-judge panel heard oral arguments in December. Judge David Tatel, who ruled against the FCC in an earlier case, in December appeared more favorable to the FCC’s position, some analysts say. Phone and cable TV stock will likely trade up or down depending on the ruling from the appeals court’s three judge panel. The case, however, could reach the U.S. Supreme Court. “Most agree this is an issue that will likely end up before the Supreme Court, especially if the FCC wins,” said Jennifer Fritzsche, a Wells Fargo analyst, in a research report published Thursday. Jonathan Atkin, an analyst at RBC Capital, said in a recent report that the appeals court may overturn rules on net neutrality that apply to wireless networks but uphold those for wireline broadband. Another court option is to “remand” the FCC’s rule-making back to the agency for additional work The FCC in February 2015 reclassified broadband services as a public utility, in order to enforce net neutrality rules under Title II of the 1934 Communications Act . The agency also expanded net neutrality rules to wireless networks for the first time. The rules bar ISPs from throttling, blocking or prioritizing Web traffic. The FCC also created a general conduct standard that ISPs cannot harm consumers or service edge providers, such as Alphabet ‘s ( GOOGL ) Google or Netflix ( NFLX ). Some consumer groups over the past six months have objected to new, so-called “zero-rated,” services offered by Verizon, Comcast and T-Mobile US ( TMUS ) that do not count video or data usage toward monthly caps.