The shares of solar energy companies are rallying after Congressional leaders agreed to extend a key tax credit for the sector. In a note to investors today, research firm Roth Capital said the deal was "quite bullish for solar."
WHAT'S NEW: As part of a major budget deal, Congressional Republican leaders agreed to extend a 30% investment tax credit, or ITC, for utility, commercial and rooftop solar projects through 2019. The credit had been slated to fall to 10% in 2017. In return, Democrats agreed to Republicans' demands to eliminate a ban on crude oil exports from the U.S. that had been in place since 1975. Congress is slated to vote on the legislation later this week.
ANALYST REACTION: The extension of the ITC would probably have a positive impact on "nearly all solar stocks," according to Roth Capital analyst Philip Shen. However, he identified SolarCity (SCTY) , SunPower(SPWR) - Get Report , First Solar(FSLR) - Get Report , 8point3 Energy (CAFD) , Canadian Solar(CSIQ) - Get Report , Hannon Armstrong(HASI) - Get Report , SolarEdge(SEDG) - Get Report , and Enphase Energy(ENPH) - Get Report as the solar companies with the greatest likelihood of benefiting from the legislation. The analyst upgraded Chinese solar companies JA Solar (JASO) and ReneSola(SOL) - Get Report , as well as solar inverter maker Enphase, to Buy from Hold on the news.
WHAT'S NOTABLE: Companies that could benefit from the repeal of the oil export ban include oil majors BP(BP) - Get Report , Chevron(CVX) - Get Report , ConocoPhillips(COP) - Get Report , Exxon Mobil(XOM) - Get Report , Royal Dutch Shell (RDS.A) and Total(TOT) - Get Report . Smaller oil producers that have been pushing for such a repeal include Continental Resources(CLR) - Get Report , Pioneer Natural(PXD) - Get Report and ConocoPhillips(COP) - Get Report , according to Bloomberg.
PRICE ACTION: In early trading, Enphase soared 55% to $3.74, JA Solar advanced 5% to $9.65, ReneSola added 9% to $1.43, SolarCity jumped 27% to $50.93, SunPower rallied 17% to $28.58 and First Solar jumped 9% to $65.42.
is a leading digital publisher of real-time financial news. Our financial market experts understand that news impacting stock prices can originate from anywhere, at any time. The Fly team scours all sources of company news, from mainstream to cutting-edge, then filters out the noise to deliver short-form stories consisting of only market moving content. Follow @theflynews on Twitter. For a free trial, click