I am assigning Sunrun (NASDAQ:RUN) a negative risk/reward rating due to its business model. The business model produces extraordinary levels of negative free cash flow with no evidence of increased operating leverage as losses are expanding alongside sales.
In this article I take a fresh look at Sunrun’s business model through the lens of its financial statements and recent performance. I then apply the most appropriate valuation method supplemented by technical analysis to formulate an investment strategy for the shares.
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