Sunrise: The Company Analysis

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Table of Contents

Abstract/Overview
Introduction
International Presence
Conclusion
References

Abstract/Overview

Sunrise is a leading solar firm in the United States market. Its most recent report demonstrates that the company recorded over 100,000 new customers in 2021 compared to 2020 (Sunrise Company, 2021). The California market accounts for almost 40% of its total sales. Notwithstanding, the other stores across the United States are performing considerably well despite the adverse effects caused by the Covid-19 pandemic. The annual recurring revenues for 2021 stood at $851 million (Sunrise Company, 2021). The decentralized organizational structure allows chief officers to make autonomous decisions that suit their markets while adhering to the company’s culture and strategic goals.

The company has managed to triple its market price share stock price in the last three years. According to Burnett and Hefner (2021), other global players in the same industry, such as First Solar Inc. and Daqo New Energy Corp, most recently recorded a share value of $79.52 and $51.31, respectively. Although Sunrise reported a total intrinsic stock value of $106.1 million, it is significantly far below the present market stock average of S&P 500 companies which presently stands at $4314.69 million (The Wall Street Journal, 2022; Sunrise Company, 2021). Despite this gap, the company has recorded an increasing price per share and improved total revenue. Investors should purchase the company’s stock confidently because it has a promising future in the stock market, especially with the increased demand for green energy globally.

Introduction

Cofounders Lynn Jurich and Edward Fenster established Sunrise Company in 2007. The issue of global warming inspired the founders to find potential mechanisms and strategies to mitigate the problem (Sunrise Company, n.d.). As a result, they established the firm to invest in green energy and lessen the carbon footprint in the atmosphere. Since its establishment, the company has enjoyed tremendous success, expanding to 22 states across the United States. Currently, it has over 660,000 customers and accounts for approximately $851 million in annual recurring revenues (Sunrise Company, 2021). The company’s success arises from enhanced diversity, transformation leadership, and commitment to a safe environment in line with the seventh sustainable development goal (SDGs) on clean and affordable energy.

International Presence

Management of International Financial Operations

The company is yet to open stores in other continents apart from North America. However, the increased campaign for green energy and the adoption of electric cars create opportunities for Sunrise to enter other markets globally, especially in Africa and Asia, where the sun is sufficiently available. Sunrise operates in 22 states across the United States, the District of Columbia, and Puerto Rico (Sunrise Company, n.d.). In this regard, the finance departments across all its branches handle the financial matters in their respective locations. Finance officers often liaise chief finance officer (CFO) at the headquarters and submit financial expenses and budgets for harmonization. The CFO is expected to issue a financial report annually, accessible to the public. This report enables the management, partners, consumers, and other stakeholders to visualize the company’s growth and identify its strengths and weaknesses.

Overseas Sales

Sunrise has adopted social media platforms such as Facebook, Twitter, and LinkedIn to market its operations online. The firm also relies on its website to attract customers globally (Sunrise Company, n.d.). However, this venture is constrained by the lack of stores in other countries globally. Consequently, Sunrise Company (2021) only sells its products to third parties, including sales partners, solar integrators, and installation partners who purchase and install the solar panels for the clients. In the recent past, the company has launched the use of drones to survey consumers’ homes as it seeks to expand its online market. Presently, drone-based inspections are available in 80% of its branches, thus improving better services to clients through digital technology (Sunrise Company, 2021). The subscriber value by the end of the fiscal year 2021 stood at $155.5 million, which accounted for 18.2% of the total sales. These figures demonstrate that the online market contributes significantly to the company’s revenue growth.

Management of Overseas Operations

The company adopts a decentralized organizational structure to manage its operations. Its top management, including the chief executive officer (CEO), co-executive chairs, CFO, chief policy officer, and chief legal officer, run the company affairs at its headquarters in San Francisco, California. Chief Officer and vice president head every division and maintain effective and direct communication with the CEO. Every unit has the autonomy to make its decisions but in line with the company’s culture and strategic goals.

Overseas Operations Trends and Contributing Factors

The firm’s overseas operations are constantly growing, as demonstrated by the financial report and the increase in the number of clients. Although the company has all its stores and offices in the United States, it collaborates with other overseas investors and partners to supply its products globally. This venture has witnessed significant growth due to the intensified use of digital media. The company’s customer base increased from 500,000 in 2020 to over 600,000 in 2021 (Sunrise Company, 2021). On its part, the solar energy capacity installed in 2021 exhibited a 31% upsurge. This growth is attributed to augmented sales in California and the online market. In the U.S., only 4% of the 77 million addressable homes have solar. The situation is the same globally, thus offering a significant opportunity for growth and an increasing operations trajectory locally and internationally.

The Market Price of the Sunrun Company’s Stock

Sunrun’s stock market price has increased for the past three financial years. Based on the financial statements for the year ended December 31, 2021, the recent market price per share is $27.72, representing an increase from $9.33 and $8.27 in 2020 and 2019, respectively (Sunrise Company, 2021). On the other hand, the total intrinsic stock value realized in 2021 stood at $106.1 million compared to $251.7 million in 2020 and $37.8 in 2019. The adverse business effects caused by the Covid-19 pandemic forced Sunrise not to pay dividends for the fiscal year 2021. According to Burnett and Hefner (2021), the solar companies with the highest solar stock per share are First Solar Inc. and Daqo New Energy Corp at $79.52 and $51.31, correspondingly. The current average stock of S&P 500 companies is $4314.69 million (The Wall Street Journal, 2022). Notably, $106.1 million is considerably less than the S&P 500 average. Despite this difference, Sunrise is within the stock value range of the solar industry in the United States as one of the sector’s leaders.

Conclusion

Sunrise is a renowned company in the solar market in the United States. Since its establishment in 2007, it has gained significant market share in 22 states in the U.S., the District of Columbia, and Puerto Rico. Outstandingly, the firm operates mainly across the United States and does not own offices and stores in other countries. However, Sunrise has attracted about 18.2% of the total sales online using social media platforms and its website. The company also engages in overseas operations mainly through third parties, such as sales partners, solar integrators, and installation partners. Its current market price per share is thrice the value reported in 2019. Additionally, the firm’s total intrinsic stock value also stands at $106.1 million compared to $4314.69 million, representing the average stock value of S&P 500 companies. Despite this difference, the company’s market price per share is rising, and thus, it is rational to purchase its stock for investment.

References

Burnett, J. W., & Hefner, F. (2021). Solar energy adoption: A case study of South Carolina. The Electricity Journal, 34(5), 106958.

Sunrise Company. (2021). Annual Report 2021 (pp. 1-141). San Francisco, California.

Sunrise Company. (n.d.). Solar Choices | Why Choose Sunrun. Sunrun. Web.

The Wall Street Journal. (2022). SPX | S&P 500 Index Stock Prices and Charts. Wsj.com. Web.

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