Sunlight Financial (SUNL) Stock: Why It Fell Over 26% Today

By Amit Chowdhry ● Sep 29, 2022
  • The stock price of Sunlight Financial (SUNL) fell by over 26% pre-market today. This is why.

The stock price of Sunlight Financial (SUNL) fell by over 26% pre-market today. 

Why: Bearish research report

Price target: Reduced from $4 to $2

Rating: Downgraded from “Buy” to “Sell”

Analyst: Citi analyst Arren Cyganovich

Cyganovich adjusted the rating to reflect the concerns with potentially lower revenue coming from platform fee rate due to interest rate volatility and potential for lost production as it loses its largest installer. And the company issued a release withdrawing its full-year guidance due to the impairment of $30 million to $33 million related to an advance to its largest installer. 

“This appears to be idiosyncratic to this installer, but also likely means lower than expected loan production ahead. We are reducing earnings estimates due to lower loan production assumptions, near-term pressure to the platform fee, and a higher one-time loss provision related to this bankruptcy. We are lowering our target price to $2 from $4 reflecting our lowered EPS estimates with our valuation multiple remaining at 10x forward adjusted 2024 P/E. Our High Risk rating reflects recent stock volatility and uncertainty surrounding today’s announcement,” wrote Cyganovich in the research note.