Why Sunrun (RUN) Stock Is Trading Lower

Sunrun Inc RUN shares are trading lower by 4% to $12.26 during Friday’s session after the company priced a $475 million aggregate principal amount of 4.00% convertible senior notes due 2030 in a private placement. Additionally, the initial purchasers have an option to buy up to an additional $75 million aggregate principal amount of the notes.

The notes will bear interest at a rate of 4.00% per year, payable semi-annually, and will mature on March 1, 2030. The initial conversion rate is set at 61.3704 shares of Sunrun’s common stock per $1,000 principal amount of notes, equivalent to an initial conversion price of approximately $16.29 per share. Sunrun estimates the net proceeds from the offering to be approximately $462.8 million.

The company intends to use the proceeds for various purposes, including repurchasing its 2026 notes, paying for capped call transactions, and general corporate purposes.

Additionally, Sunrun has entered into capped call transactions to reduce potential dilution to its common stock upon conversion of the notes.

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Sunrun Stock Forecast In 2030

Predicting the future in stock prices over long periods of time is challenging. Wall Street analysts use complex models that take into account interest rates, economic growth, competitive advantages, management teams and historical profitability, among a host of other factors.

If, as an investor, you want to assume most of the major factors remain stable, you can use trend analysis as a helpful tool. Using a longer term trend line or historical performance of the stock, you can aim to forecast a stock's annual rate of return.

For Sunrun, over the past 5 years, it's annualized stock performance is -4.04%, and if you assume that trend continues for another 5 years, you can expect a stock to trade at $10.11.

Using a trend line (see how to perform this function here), If you choose to use a trend line, connect your two points and look into the future to the point in time in which you're curious. Once you've identified that stock price, you may want to consider what type of conditions would need to exist for the stock to justify the share price – be it an outside influence or managerial decision making.

According to data from Benzinga Pro, RUN has a 52-week high of $25.80 and a 52-week low of $8.43.