SolarCity to Open 1 Score Operations Centers in 7 States - Analyst Blog

Solar power major SolarCity Corporation ( SCTY ) continues to spread wings in the U.S. The company announced that it will set up 20 new operations centers in 7 states - Arizona, California, Delaware, Maryland, Massachusetts, Nevada and New York - of the country. SolarCity is scheduled to complete this program in 2014.

The expansion is aimed at curtailing operation costs by reducing service as well as installation drive times. This is expected to enable SolarCity to improve its margins and serve customers more efficiently.

In addition, SolarCity will be able to create over 600 additional jobs in the aforesaid states, thereby improving state and local economies.

SolarCity's modus operandi combine engineering, installation, maintenance, monitoring, financing and sales of its solar energy systems. This enables the company to provide hassle-free energy solutions to residential, commercial and government customers. The company offers an option to its customers to either purchase and own solar energy systems or to purchase energy generated from its solar energy systems through several contractual arrangements. The customers can purchase solar energy from SolarCity at a price cheaper than what is charged by utility providers.

SolarCity is currently pursuing multiple growth avenues and marketing ploys to strengthen its presence across the nation. In the last few months, the company opened new operations centers in Maryland, Massachusetts, Hawaii and New York. As of Jun 30, 2014, the company's cumulative number of customers jumped around 52% to 141,034 from 92,998 at year-end 2013.

SolarCity's strategy to open new operations centers and expansion of capacity are in line with its plans to popularize rooftop solar in the country at next-to-no-cost for residential installers. In the wake of stringent regulations, solar energy at affordable prices is seeing an increasing uptake in the U.S.

SolarCity announced in Jul 2014 that it has partnered with a leading national homebuilder K. Hovnanian Homes, to provide solar power options for two new communities in Peoria, AZ. In another transaction, in Jun 2014, the company inked a contract to acquire a solar technology and manufacturing company Silevo.

SolarCity maintains a stable liquidity position with cash and cash equivalents of $405.3 million as of Jun 30, 2014. A steady financial position allows the company to follow its expansionary policies.

SolarCity currently holds a Zacks Rank #3 (Hold). However, other better-ranked stocks in the same sector include Canadian Solar Inc. ( CSIQ ), ReneSola Ltd. ( SOL ) and Enphase Energy, Inc. ( ENPH ). Canadian Solar and ReneSola sport a Zacks Rank #1 (Strong Buy) while Enphase Energy carries a Zacks Rank #2 (Buy).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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