SolarCity's Bright Growth Prospects

Founded in 2006 with the initial objective of selling solar energy systems outright, SolarCity (SCTY-$55.60) has since embraced the concept of being in the “energy finance” business. Avoiding utility-scale solar projects dominated by the likes of a First Solar (FSLR), the company now aggregates small PV residential rooftop projects into large solar leasing portfolios that offer predictable, recurring revenue streams either through power purchase agreements (where customers – residential homeowners – pay a fee per kWh based on the amount of electricity the solar energy system actually produces) or by contracted lease agreements (fixed monthly fees).

Third-quarter 2103 gross margins speak to the profit potential afforded this “finance company’s” business model: gross profit of operating leases to retail customers (homeowners and small business owners) was $16.3 million, or 66% of lease revenue; the gross profit margin of PV energy systems sold was $1.1 million, or 5% of sales!

SolarCity is the U.S. leader in rooftop residential solar installations, with a market share of….

Continue Reading at YCharts: Facts and Myths Behind SolarCity’s 331% Rise

Editor David J Phillips does not hold a financial interest in any stocks mentioned in this article. The 10Q Detective has a Full Disclosure Policy. 

Frosty Future for Erectile Dysfunction Drugs

A recent report published by Transparency Market Research has cast a pall on the future profitability of the PDE5 inhibitor sex drug class, forecasting that annual sales of sexual dysfunction drugs will fall from $4.3 billion in 2012 to $3.4 billion in 2019. The study authors opine that the loss of Pfizer’s (PFE) Viagra patent exclusivity in Canada, Asia and Europe will weaken all drug manufacturers’ lock – including Eli Lilly’s (LLY) Cialis and Bayer’s (BAYRY) Levitra – on pricing power in coming years.

Though a U.S. federal judge reaffirmed Pfizer’s “method-of-use” patent, blocking Teva Pharmaceuticals (TEVA) and others from launching their own generic versions until October 2019, the competitive landscape elsewhere is more hostile. Through September 2013, Pfizer reported that U.S. sales of Viagra held steady at $819 million; international revenue declined 13% to $586 million, however, as the Israeli-based drug maker, U.S.-based generic manufacturers Actavis (ACT) and Mylan (MYL), and other generic houses started to roll-out cheaper copies of sildenafil back in July.

Continue reading at YCharts: Why Pfizer’s Expiring Viagra Patent Hurts Lilly Most

Editor David J Phillips does not hold a financial interest in any stocks mentioned in this article. The 10Q Detective has a Full Disclosure Policy.