Sunrun: “ESG” is for Everybody Screws the Government (RUN US)
Muddy Waters is short Sunrun Inc. (RUN) because we see it as an uneconomic business built on three shaky pillars: The equity story of exaggerated “Subscriber Values” and “Gross / Net Earning Assets”, funding growth through abusing tax incentives, and issuing ABS that could be exposed to a RUN bankruptcy. These pillars, in turn, are built on a foundation of dubious financial models. If one of these three pillars wobbles, RUN would likely face a funding gap and would require equity issuances to continue growing. Insiders have already become ultra-wealthy, having net sold shares since July 2020 for $205.9 million. RUN is on its third CFO since January 2020.
Basically, this is a solar panel installation company. It sells batteries too. It makes no profits, and burns through $2mmm a year, on a revenue of $1.77 pa. It pays out $170mm of SBC and for some bizarre reason spent $1.75 mmm on PPE in the last twelve months.
Frankly, there is no bull case for this stock, except that a Ponzi can keep operating longer than you can avoid a margin call.
The day in the markets
MARKET SNAPSHOT AS OF 0430 GMT
S&P 500 Index Mini Futures: 4,162.75; up 0.25%; 10.5 points
DJIA Mini Futures: 32,769.00; up 0.27%; 88 points
Nikkei: 28,150.17; up 0.78%; 217.97 points
MSCI Asia, Ex-JP: 527.06; up 0.83%; 4.36 points
EUR/USD: $1.0235; down 0.10%; 0.0010 point
GBP/USD: $1.2142; down 0.15%; 0.0019 point
USD/JPY: 133.29 yen; up 0.32%; 0.42 point
Spot Gold: $1,791.43; up 0.02%; $0.35
U.S. Crude: $88.87; up 0.37%; $0.33
Brent Crude: $94.34; up 0.23%; $0.22
10-Yr U.S. Treasury Yield: 2.6863%; up 0.012 point
10-Yr Bund Yield: 0.8025%; down 0.059 point
Basically, the day was flat.
$BYND someone told me this has sub 4 quarters of cash left. Negative GM and $1.1bn in debt?— Michael Taylor (@Mike_Taylor1972) August 4, 2022