- Buying Silevo makes SolarCity into a vertical integrator in the solar space.
- Higher efficiency modules promised aren't as industry leading as promised.
- The stock valuations of vertical integrators in the solar industry leave a lot to be desired.
With the announcement
a couple of weeks ago that SolarCity (SCTY)
was buying a manufacturer of solar modules, the market sent the stock
soaring for questionable reasons. The biggest issue with any vertical
integration is that the company is now somewhat trapped into a
technology instead of pursuing the most economical solution available on
the market. Secondarily, the solar module market has never lacked from
investments, nor is the manufacturers historically overly profitable.
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at Seeking Alpha.
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