SolarCity: Where the Sun Always Shines, No Matter What

For the third quarter of 2014 the company expects lease and incentive revenues to total $54 to $63 million and gross margins to be between 50% and 55%. Operating expenses are pegged at $115 to $125 million and the non-GAAP EPS loss is expected to be in the range of $1.10 to $1.20.

The analysts’ consensus estimates for the current quarter call for an EPS loss of $1.00 on revenues of $81.87 million. The company’s own estimate for a larger loss will hit the shares in after-hours trading Thursday and carry over into Friday. And the revenue forecast from the company is way below the analysts’ consensus

SolarCity expects to deploy 135 to 150 megawatts of solar energy systems in the third quarter and 500 to 550 megawatts for the full 2014 fiscal year. The full-year 2015 estimate calls for 900 to 1,000 megawatts of deployment. SolarCity’s deployment estimates have not changed since they were announced at the end of the first quarter. The customer base grew from 110,000 to 140,000 in the second quarter.

The good news is that SolarCity grew its contracts payments from about $2.5 billion to $3.3 billion. That’s healthy growth, but that needs to rise more quickly if the company is going to maintain its hoped-for growth path.

SolarCity’s shares are down about 0.3% in after-hours trading, at $75.37 in a 52-week range of $28.31 to $88.35. Thomson Reuters had a consensus analyst price target of around $86.80 before today’s results were announced.

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