11:10 AM EDT, 06/18/2025 (MT Newswires) -- Enphase Energy ( ENPH ) , SolarEdge Technologies ( SEDG ) , and Sunrun ( RUN ) face weaker residential solar demand under the proposed US Senate reconciliation bill, RBC Capital Markets said in a Wednesday note, citing new lease restrictions and the elimination of the 25D tax credit.

The brokerage said it revised estimates, ratings, and price targets for the firms under the assumption that the current Senate version passes, which is more favorable than the House version due to eased FEOC restrictions and removal of an accelerated construction requirement.

Enphase is expected to maintain pricing on its microinverters despite a market downturn, supported by a strong product roadmap and cost-saving initiatives. However, RBC flagged weaker battery storage competitiveness and potential delays in rolling out next-gen products.

The brokerage maintained its sector perform rating and lowered its price target to $28 from $50.

SolarEdge ( SEDG ) could benefit from its exposure to the commercial and industrial segment as well as European markets, although demand in Europe remains soft. RBC said its manufacturing shift to the US may help capture more IRA-related credits and offer margin flexibility. It reiterated a sector perform rating and cut the price target to $12 from $14.

Sunrun ( RUN ) was downgraded to sector perform from outperform, with the brokerage citing its dependence on financing and exposure to rising interest rates and policy risk. RBC said the solar-as-a-service provider is particularly vulnerable to the proposed lease restrictions and macroeconomic pressures. The price target was reduced to $5 from $12.

Utility-scale solar firm First Solar ( FSLR ) was seen as more resilient due to its strong backlog and domestic manufacturing footprint. However, the repeal of a stacking provision under Section 45X could cut its tax credit eligibility from $0.17 to $0.07 per watt starting in 2026.

RBC reiterated an outperform rating but lowered its price target to $188 from $230.

Price: 35.97, Change: +1.05, Percent Change: +2.99