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SolarCity stock tumbles after weak first quarter

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WBFO
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SolarCity stock fell sharply Monday as the company said things didn't go well in the first three months of the year.

In an interview with stock market analysts, company executives say there was a headwind against SolarCity earlier this year, but things are getting better in this quarter.

They blamed regulatory uncertainty and consumers buying last year in fear of a federal tax credit going away, but say that's all over and things will be better later this year and next year.  

SolarCity shares fell roughly 15% in after-hours trading.

"We're looking hard toward being cash flow-positive in Q4. At that point in time, we're going to be looking at the market conditions, the cash generation of the business and then decide if we want to go back into growth mode," said President Tanguy Serra.

CEO Lyndon Rive says business changes mean improvements.

"There are some states that do not allow us to offer legal PPA And, with this new consumer loan product, we'll be able to offer legal PPA in the states. In terms of regulational policy, we now better clarity than we have had for a very long time," Rive said.

SolarCity officials say there is a lot of public interest in their products and more interest in purchasing rather than leasing and better relationships with traditional electric utilities. There was no mention of the company solar panel plant in South Buffalo which is supposed to start making solar panels later this year.

"In terms of growth, we are very excited about all the innovation that we are doing here and although we are seeing about 20% growth this year, I don't want to forecast forward for '17. But, once the business starts generating cash, the goal would be to go back into growth mode again," Rive said.

The company says revenues were higher than expected and state regulators seem satisfied with the company's activities and there is a rising market for SolarCity's solar panels and services.