Roth MKM says solar selloff creates buying opportunities for quality companies

Following Trump’s presidential win last night, Roth MKM says that phasing out the ITC/PTC earlier is likely very much on the table, which is a negative for the solar sector as it likely lowers demand for the companies in the firm’s coverage universe. A DC lawyer shared, the Republicans “plan a whole series of tax cuts and have to pay for it somehow.” Roth notes that its work over the past few months suggested that the 45X should be safe. Its checks today continue to support this view, which is a positive for First Solar (FSLR) and others benefiting from 45X. Additionally, Mike Johnson, the GOP Speaker of the House, highlighted that they would approach changes to the IRA with a “scalpel” rather than a sledgehammer, the firm adds. With many solar stocks down, Roth recommends buying the dip opportunistically. The firm would put First Solar in that bucket along with Nextracker (NXT). Roth also notes Sunnova (NOVA) and Sunrun (RUN) are down 50% and 30% intraday, respectively.