Newsbytes: Elon Musk’s SolarCity Crashes

By Dr Benny Peiser – Re-Blogged From http://www.WattsUpWithThat.com

As SolarCity Crashes, Is Elon Musk Overrated?

Shares of SolarCity nose-dived on Tuesday after disclosing earnings results that cast gloom over the provider of solar systems. The big problems for the solar company: The quarterly report disclosed a loss that was bigger than expected, and management followed that up with a dismal outlook for future results. So far in 2016, SolarCity shares have plummeted 65 percent. –George Avalon, Silicon Beat, 10 May 2016

The real problem with Tesla cars is that no one actually buys them. Well, not directly. Their manufacture is heavily subsidized — and their sale is heavily subsidized. Tesla does not make money by selling cars, either. It makes money by selling “carbon credits” to real car companies that make functionally and economically viable vehicles that can and do sell on the merits — but which are not “zero emissions” vehicles. It is estimated that Musk’s various ventures — including his new SolarCity solar panel operation and SpaceX — have cost taxpayers at least $4.9 billion, with Tesla accounting for about half of that dole. –Eric Peters, The Detroit News, 9 May 2016

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SolarCity is struggling. Tesla is struggling. Elon Musk is not the King Midas of making companies perfect. Musk’s magic can’t do everything anymore. –Ryan McQueeney, Nasdaq, 10 May 2016

After their hot rally at the end of last year, shares of solar energy firms have turned ice cold as concerns about slower growth and regulatory uncertainties plague the group. SolarCity led the sell-off on Tuesday after the company cut its 2016 forecast for solar panel installations late on Monday and posted a larger-than-expected quarterly loss. Investors have been worried about the outlook for growth for the solar sector, especially following a pullback in an important Nevada solar support policy and uncertainty about pending regulatory decisions in other states. Nevada regulators this year announced changes that mean new tariffs that will raise fees solar customers pay to use electric grids. Reimbursements to users are also being cut and investors fear such moves could be repeated in other states. –Caroline Valetkevitch, Reuters, 11 May 2016

solar-city

Worse, the company implicitly predicted more rough quarters ahead, dialing down its target for solar-power system installations this year. With fewer homeowners and businesses opting for a SolarCity solar-power array, the company will have trouble keeping its installation costs down. After three-quarters of foiled expectations, SolarCity’s “credibility is likely at an all-time low,” analysts at Roth Capital said in a note to clients Tuesday. The stock lost more than 25% on Tuesday, on track for its lowest close and its largest one-day decrease since February. Shares are down more than 44% so far this month, and more than 66% year-to-date. Shares traded as low as $16.50 earlier Tuesday, off more than 80% from an all-time high of $86.14 in February 2014. – MarketWatch, 10 May 2016

CONTINUE READING –>

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