Sunrun Inc. (NASDAQ: RUN) has recently experienced a staggering 37.69% decline in its share price from May 20 to May 27, 2025, landing it on the list of Energy Stocks That Lost the Most This Week. Let’s delve deeper into the reasons behind this huge drop and what it means for investors.
A sparkling field of solar panels reflects Sunrun’s commitment to renewable energy. As America’s leading provider of clean energy as a subscription service, Sunrun offers residential solar and energy storage solutions with no upfront costs. However, recent legislative developments pose significant challenges for the company.
The decline in Sunrun’s share price can be attributed to a recent narrow passage of President Trump’s far-reaching tax and spending bill in the House of Representatives. This legislation threatens to end Biden-era tax credits for clean energy projects much sooner than anticipated, which could strike a devastating blow to the solar industry that heavily relies on these credits.
In particular, the rooftop solar sector finds itself in jeopardy. If the bill passes through the Senate, it could eliminate credits for rooftop solar and battery storage, critical elements for many companies, including Sunrun. Currently, around 70% of rooftop solar installations operate on lease agreements, making the company’s business model vulnerable. Moreover, the removal of tax credit transferability for installers further jeopardizes Sunrun, which previously generated over $700 million last year by transferring investment tax credits.
While we recognize Sunrun’s potential for growth, our analysis indicates that certain AI stocks may offer greater opportunities for substantial returns with relatively lower downside risks. If you’re interested in discovering an AI stock that might outperform RUN and hold the potential for 100x upside, check out our exclusive report on the cheapest AI stock.
READ NEXT: Explore our insights on 10 Cheap Energy Stocks to Buy Now and discover the 10 Most Undervalued Energy Stocks to Buy According to Hedge Funds.
Disclosure: None.