Boston, MA 02/18/2014 (wallstreetpr) – SolarCity Corp (NASDAQ:SCTY) shares continue to confound analysts in the market in the current fiscal year, considering they performed extremely well in the previous fiscal year. SolarCity shares dropped by as much as 2% on Friday February 14, 2014 trading session, marking its second most loosing position in the current fiscal year. Solar city currently commands a market capitalization of $7.5 billion that is approximately 25 times of tangible book value.
The company is currently at the right position considering many consumers are expected to massively lease solar panels from it. Despite all this, SolarCity considers this as a low return finance business as many of this consumers are expected to finance their purchase through mortgages. Many analysts have recently weighed into solar city giving it mixed ratings.
SolarCity rating in the market
Analyst at JPMorgan Chase & Co on a research note to investors on January 21, 2014 lowered the company ratings from an “overweight” to a “neutral” with a price target of $68 which is substantially low compared to the current price trading of $78.94 a share.
On the other hand analyst at Deutsche bank had given solar city a more favorable rating of a “buy” with an exciting price target of $90 with analysts at Robert W Baird giving it a price target in the range of $71 $81 with an “outperform” rating. Four analysts firms have essentially rated SolarCity as a “hold” with another four rating it as a “buy”. Solar city currently commands an average rating of a “buy” with a price target $75.57.
Highlights of SolarCity ratings
SolarCity currently commands a debt to equity ratio of 1.03 that is significantly high when compared to the industry average, something the company management should address to prevent the company from being engulfed in massive debts. Its quick ratio of 0.59 indicates its inability to cover short term liquidity needs. Despite all the negatives, SolarCity commands a high gross profit margin of 67% that has increased compared to last year’s same period margins.
SolarCity Corp (NASDAQ:SCTY) cash flow has been on an increase reaching highs of $100.01 million when compared to the same quarter a year ago where the company had no net operating cash. With the continuous growth of renewable energy, things could get greener in the coming years for SolarCity.
