Goldman Sachs Upgrades Sunrun on 2025 Momentum, Eyes Continued Growth in Solar Sector

Goldman Sachs has upgraded Sunrun (RUN) to 'buy' based on the company's standout execution during the final quarter of 2025, which delivered a 22% year-over-year increase in new customer installations and a 14% improvement in gross margins. The firm noted that Sunrun's ability to scale operations while maintaining profitability reflects operational maturity and competitive advantage in the U.S. residential solar market. The upgrade underscores broader optimism in the clean energy sector, with Sunrun's performance signaling strength in a category that includes Enphase Energy (ENPH) and First Solar (FSLR). Despite macroeconomic headwinds, Sunrun reported 18% revenue growth in Q4 2025, driven by higher system prices and expanded service offerings, including battery storage integration. This momentum aligns with a 24% rise in solar project permitting activity nationwide in 2025, according to public data. Analysts at Goldman Sachs project Sunrun will maintain a 16% compound annual growth rate in installations through 2027, supported by federal tax incentives and state-level renewable mandates. The firm also highlights Sunrun’s improving customer retention, which reached 92% in 2025—a key metric for recurring revenue in the energy-as-a-service model. The positive outlook is likely to influence investor sentiment toward the broader solar and energy storage ecosystem. Shares of ENPH and FSLR have already reacted with gains of 5.8% and 4.2% respectively over the past week, reflecting sector-wide enthusiasm. Market participants are now closely tracking Q1 2026 guidance from major solar developers for signs of sustained demand.