Deutsche Bank downgrades Sunnova to Hold on sluggish demand

Deutsche Bank downgraded Sunnova Energy to Hold from Buy with a price target of $12.50, down from $23. The analyst cut solar numbers into the second half of 2023 and 2024 on sluggish demand and lingering environmental headwinds. The firm sees further downside with sluggish demand on the residential side, both in the U.S. and Europe, a “stuffed” inventory channel which likely will take the next two to three quarters to decrease, pricing pressure and high competition on equipment, and overall challenging macro conditions. At this time, Deutsche would expect to see a bottom forming in late Q1 to Q2 of 2024, before potentially seeing a rebound into the second half of 2024.