Sunrun (RUN) is the largest residential solar energy systems company in the U.S. It installs home solar panels and batteries under a “solar-as-a-service” model — customers enter into long-term leases or power purchase agreements (PPA) instead of purchasing equipment outright.
This approach lowers the upfront costs for consumers transitioning to solar energy, while Sunrun generates its primary revenue through subscription payments and monetization of renewable energy tax incentives. The company’s business scale includes over 1 million customers and presence in most key states, which, together with the expansion of its product line (home batteries, energy management systems), strengthens its leadership in the residential renewable energy segment.
Investment attractiveness factors:
• Leadership and market share growth. Sunrun holds ~20% of the U.S. new residential solar installation market and about 40% of the home energy storage segment. The company significantly outpaces competitors due to its scale and lease model: over 95% of Sunrun sales come from subscriptions (one-third of the market for such services). This strategy allows the firm to directly utilize tax incentives and offer customers a low entry barrier, especially important amid rising loan rates. At the same time, several competitors exited the market: in 2024–2025, major industry players, including SunPower and Sunnova, went bankrupt, opening additional opportunities for Sunrun to capture the freed-up demand.
• Rapid growth in energy storage. Sunrun is actively expanding in the home battery segment. In Q3 2025, approximately 70% of new customers connected energy storage systems (up from ~60% the previous year), and the company supplied 42% of all new home battery installations in the U.S. in Q2 2025. Through its “storage-first” strategy, Sunrun increases average revenue per customer and protects margins: additional storage services offset less profitable net metering rates and create new revenue streams. Over 100,000 Sunrun customers are already part of virtual power plant (VPP) programs — a network of home batteries selling energy to the grid at peak loads, with participation growing over 400% year-over-year. This development not only drives battery sales but also converts stored solar energy into a commercial product, strengthening Sunrun’s competitive advantage.
• External drivers and partnerships. The macro environment and government support favor the company. The Inflation Reduction Act (IRA, 2022) extended a 30% tax credit for home solar installations through 2032, providing long-term incentive for households to adopt solar. Simultaneously, rising electricity rates and more frequent outages increase the attractiveness of home solar systems with batteries as a cost-saving and backup power solution.
Sunrun also strengthens its position through technological advantages and alliances: the company invests in software for distributed generation management, collaborates with utilities and automakers (e.g., Ford F-150 Lightning EV integration into home energy systems), and partners with major homebuilders for solar panel installations in new homes. These factors support Sunrun’s sustainable business growth, enhancing revenue potential and return on invested capital.
Target price: $23