Sunnova Energy (NYSE: NOVA) was a ray of light on the stock exchange on Tuesday. Shares of the solar energy company were trading nearly 8% higher in late-session action, following news of a partnership with a famous retailer. The stock was notably outpacing the bellwether S&P 500 index, which was inching up by 0.2%.
A new deal with a top retailer
Well before market open that day, Sunnova announced that it had agreed with Home Depot (NYSE: HD) to be the retailer’s sole provider of solar and battery services in its U.S. stores. At a stroke, this opens a major sales channel for the solar company’s Adaptive Home suite of products, as the deal covers more than 2,000 Home Depot outlets.
The new arrangement dramatically expands an existing partnership between the two companies. In 2021 Home Depot began selling Sunnova’s SunSafe solar and battery service in 100 of its stores in locations where hurricanes were a threat. This cooperation grew to a total of 15 markets, blanketed with around 400 Home Depot outlets.
In its press release trumpeting the new deal, Sunnova quoted its chief revenue officer Michael Grasso as saying, “As utility rates continue to skyrocket across the country, weather patterns worsen, and remote work becomes more prevalent, the need for resilient, affordable, and dependable power at the home is nonnegotiable.”
He added, “Now shoppers at The Home Depot stores nationwide will have easy access to Sunnova’s solar and storage offerings.”
Dramatic expansion
While Sunnova was obviously proud and eager to share its news, it did not provide any estimates as to how the Home Depot deal might affect its financials. Regardless, it is clearly a win for the solar company, as it dramatically improves its presence in a well-trafficked specialty retailer.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Home Depot. The Motley Fool has a disclosure policy.
Why Sunnova Energy Stock Was Racing Higher on Tuesday was originally published by The Motley Fool