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What Could Elon Musk's SolarCity Be Hiding?
" ... Investors in renewable energy company SolarCity Corp. should be wondering just that given several "confidential treatment orders" filed with the SEC over the last few months. ...
... SolarCity, the company was granted confidential treatment orders on March 18, June 23, July 7 relating to recent 10-Q and its 2014 10-K filings. Even thought it will be some time until we find out the nature of the confidential information and assess the impact on the company's business, we do know analyst expectations for the company's earnings have been falling deeper into the red over the last 90 days for both 2015 and 2016 and, subsequently, SolarCity shares have fallen 18% since mid-March. ...
There are several possibilities as to what could have led SolarCity to request these treatment orders, including the fallout from FBI and Oregon Department of Justice criminal and civil investigations following reports that projects should not have been eligible for state tax credits. Other possibilities include the findings of Federal investigators after spending nearly a year combing through the books of two solar energy companies tied to billionaire Elon Musk (SolarCity's Chairman) following claims the businesses overvalued sales contracts in order to claim millions in federal assistance. Prior to that, SolarCity was already in the cross-hairs of the U.S. Treasury and IRS, as those two institutions tried to determine if SolarCity deliberately cranked up the cost of products to cash in on the government grant program.
Depending on the period of time granted in conjunction with the confidentiality treatment orders, we'll find out before too long. And, as the saying goes, "where's there's smoke, there's fire" and given the number of confidential treatment orders by SolarCity there is apt to be far worse news ahead for SolarCity shareholders.
Given the growing skepticism over opportunities for Tesla Motors (TSLA) that led to a sharp drop in the company's market cap amid several downgrades, news of government investigations into SpaceX following recent rocket ship explosions and more potential bad news at SolarCity, one has to wonder if we'll someday soon be referring to Musk, who heads all three in one way or another, as a former golden child. ... "
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