Solar stocks rebounded on Friday but were still on track to close out the week with steep losses as Wall Street assesses last-minute changes slipped into the tax-and-spending bill approved by the House this week, which threaten to disrupt the industry.
SolarEdge (SEDG), Sunrun (RUN), Complete Solaria (SPWR), and Enphase Energy (ENPH) were among the biggest decliners this week, all down double-digit percentages.
Most of the damage to the sector came on Thursday after the “big, beautiful bill” passed by one vote called for ending key investment and production tax credits from the Biden-era Inflation Reduction Act three years sooner than what analysts expected. Wind and solar projects eligible for credits would need to begin construction within 60 days of the bill being signed into law.
While analysts believe the current version of the bill is unlikely to survive intact in the Senate, the prospect of tighter restrictions still spooked investors, prompting a broad sell-off.
“To be finalized and signed into law in its current form — that would create a lot of disruption and layoffs, project cancellations, potentially bankruptcies,” Pavel Molchanov, investment strategy analyst at Raymond James, told Yahoo Finance.
Molchanov said the industry will be busy in the next few weeks lobbying the Senate to revert to less severe provisions. Key senators from states where solar and wind initiatives are located are expected to also push for a softer stance.
