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Solar stocks are wavering despite lofty expectations.

RBC Capital Markets initiated coverage of Sunrun on Wednesday, rating it outperform and giving it a price target of $81 per share. Even so, shares of the solar panel maker closed 4% lower at $54.21.

The Invesco Solar ETF (TAN) also took a hit on Wednesday, falling 3% to $86.48. The popular fund is now down about 29% from its high in January.

Katie Stockton, managing partner and technical analyst at Fairlead Strategies, has been watching the weakness play out for some time.

“Solar stocks had been under pressure along with growth stocks,” she told CNBC’s “Trading Nation” on Wednesday.

Stockton said Fairlead had initially recommended shorting Enphase Energy, TAN’s largest holding, but later said to cover the position as a short-lived correction in TAN appeared to stabilize.

“I think this is a nice staging ground for a potential relief rally,” Stockton said. “The ETF had already been up nearly 500% of that Covid low from last year. Retracement like this is healthy, in our opinion, and something that can contribute to the long-term uptrend.”

Quint Tatro, chief investment officer of Joule Financial, said to keep an eye on the solar stocks.

“Investors can’t fall asleep on these names down here,” he said in the same “Trading Nation” interview. “It’s easy to do with underperformance, but I think there’s some value to be found.” 

Tatro’s top pick was First Solar.

“We view this company almost like a utility stock, like a solar utility play,” he said, highlighting the company’s tangible book value of $52 per share, relatively low debt and notable earnings growth.

“We need momentum. That’s true for growth. That’s true for solar, but don’t fall asleep on these names,” he said. “I think they’ll shine again.”

Disclosure: Joule Financial and Tatro own shares of First Solar.

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