Sunpower Delivers Another Ho Hum Quarter
EnerTuition • 16 Comments
EnerTuition • 16 Comments
SunPower Analyst Day Disappoints
Yesterday, 11:24 AM
- Most solar companies likely will miss expectations in Q3, “extending the challenging setup for stocks that has persisted recently,” Goldman Sachs’ Brian Lee says, but adds that the upcoming U.S. election could offset company specific issues and act as a bigger catalyst.
- Lee considers Sunrun (RUN -2.8%) a top Q3 idea, maintaining a Buy and $10 price target, and thinks RUN could deliver an earnings beat since the company appears “best positioned to capitalize on the current cycle that has sent input prices sharply lower."
- Lee maintains a Sell rating and $13 price target on Solaredge Technologies (SEDG -0.8%), believing that while EPS could beat expectations, there is more risk to the guidance, with checks suggesting “growth is not accelerating into year-end and mix could be weaker (slower HDWave uptake).”
- The firm maintains Neutral ratings for First Solar (FSLR +1.5%), SolarCity (SCTY +0.6%), SunPower (SPWR -0.4%) and Vivint Solar (VSLR -1.5%).
- ETF: TAN
Fri, Oct. 7, 10:19 AM
- A new SEC team this year was tasked with reviewing Q2 filings to check compliance with new guidelines on use of non-standard financial metrics.
- First Solar (FSLR -4.8%) and SunPower's (SPWR -5.1%) 8Point3 Energy Partners (CAFD -0.1%) has the honor of being the first to receive a letter from that task force (it's yet to be made public).
- CAFD last month raised $102.6M from investors to acquire completed power plants from its parents, and it's the numbers in that prospectus that's caught the SEC's eye. In a late-July letter to the company, the SEC asked what was being left out of adjusted EBITDA numbers and its description of cash available to investors.
- Source: Marketwatch's Francine McKenna
Thu, Oct. 6, 3:24 PM
- Formerly bearish Axiom Capital analyst Gordon Johnson upgrades his rating on the solar energy sector (TAN +0.5%) by two notches to Overweight from Underweight, and raises his ratings on Yingli Green Energy (YGE +4.6%), Trina Solar (TSL +1.3%) and JA Solar (JASO +4.5%) to Buy from Sell, as well as SolarCity (SCTY -2.6%) to Hold from Sell.
- A key reason for Johnson's "new-found solar optimism" is China's decision to cut solar subsidies, which could result in ~25 GW of Chinese “pull-in” demand in H1 2017, suggesting a undersupply in the solar market that should push prices higher.
- Johnson believes the stronger demand will cause the prices of all kinds of solar equipment to surge, resulting in higher margins and multiples for many solar companies.
- Also: OTCPK:SUNEQ +63% (see earlier), CSIQ +0.7%, SPWR +0.3%, FSLR -0.3%.
Tue, Sep. 20, 4:57 PM
- 8point3 Energy Partners (NASDAQ:CAFD) agrees to acquire SunPower's (NASDAQ:SPWR) 49% stake in its 102 MW Henrietta Solar Project for $134M.
- CAFD expects the acquisition to generate ~$10.9M in annual cash distributions and has a 20-year contract life.
- The Henrietta project, located in California's San Luis Valley, will begin operations next month, and is majority owned by Southern Co. (NYSE:SO)
- CAFD +1.9% AH, SPWR +0.5%.
Tue, Sep. 20, 8:43 AM
- SunPower (NASDAQ:SPWR) agrees to acquire AU Optronics' portion of the two companies' joint venture which manufactures solar cells at an 800 MW fabrication facility in Malaysia.
- SPWR will pay $170M over four years under a stock purchase agreement, and will supply 100 MW of its E-series solar panels to AUO.
- AUO will remain a wafer supplier, SPWR says, adding that the transaction resolves a dispute between the two companies.
Wed, Sep. 14, 3:00 PM
Wed, Sep. 14, 12:47 PM
Thu, Sep. 8, 12:58 PM
- The tough environment for solar stocks (TAN +0.7%) will continue for another 18 months, but falling solar stocks may have created buying opportunities among some of the top names in the space, according to analysts at JMP Securities.
- Until the overall solar market improves, JMP prefers stocks that are gaining market share and have favorable competitive positioning, adding that further consolidation in the sector is likely.
- JMP rates Vivint Solar (VSLR +4.4%), Sunrun (RUN +1.4%) and Solaredge Technologies (SEDG +0.2%) at Market Outperform, Canadian Solar (CSIQ +1.5%) at Market Perform, and First Solar (FSLR -0.5%) and SunPower (SPWR -1.3%) at Underperform.
Fri, Aug. 12, 12:35 PM
- SunPower (SPWR -1.5%) is downgraded to Equal Weight from Overweight with a $12 price target at Morgan Stanley, which says the company is less isolated from industry challenges that it had expected.
- The firm says industry headwinds have led to lower than expected visibility into the execution of SPWR’s utility-scale project pipeline, causing it to lower EBITDA estimates through 2020 by $150M-$250M/year to reflect lower system volumes, pricing and margins.
- SPWR shares have dropped ~30% since announcing significant cuts to its 2016 and 2017 guidance, citing severe weakness in its power plant business.
Wed, Aug. 10, 3:25 PM
- Analysts are taken aback by SunPower's (SPWR -29.6%) "guidance bomb" which calls for 2016 gross margins of 9.5%-11.5% instead of 13%-15% amid slowing demand for utility-scale solar projects and more competition in the panel market.
- The surprise is weighing on other stocks in the group: FSLR -7.5%, CSIQ -8.7%, SEDG -9.8%, VSLR -3.1%, JASO -4.5%, SolarCity SCTY -0.9%, SUNE -1.9%, Trina Solar TSL +0.1%.
- At least six firms slammed the stock with downgrades - J.P. Morgan, Oppenheimer, Deutsche Bank, Janney Capital, Credit Suisse and Avondale.
- R.W. Baird, who maintained his Outperform rating but slashed his price target to $21 from $37, said during SPWR's earnings conference call that he felt "blindsided... when you guys have publicly spoken over the past near couple of weeks, we didn’t hear any kind of hint of this at all."
- Credit Suisse’s Patrick Jobin, who cuts his rating to Neutral from Outperform as well as his price target to $12 from $32, says management now faces a credibility problem.
- Not everyone is negative: BofA/Merrill says SPWR's reduced guidance was a disappointment but the stock remains a Buy due to its technology and efficiency advantages, pipeline and backing from global energy giant Total.
Wed, Aug. 10, 3:00 PM
Wed, Aug. 10, 12:47 PM
Wed, Aug. 10, 9:17 AM| Wed, Aug. 10, 9:17 AM | 4 Comments
Tue, Aug. 9, 5:35 PM
Tue, Aug. 9, 5:27 PM
- SunPower (NASDAQ:SPWR) -25.5% AH following a smaller than forecast Q2 loss and better than expected revenues, but the company also lowered its full-year revenue forecast, saying aggressive pricing by new market entrants has hurt near-term economic returns.
- SPWR issues downside guidance for FY 2016, now seeing revenues of $3B-$3.2B, vs. $3.28B analyst consensus estimate and below its earlier outlook for $3.2B-$3.4B, and expecting to deploy 1.45-1.65 GW in 2016, vs. its earlier forecast of 1.6-1.9 GW.
- SPWR says the extension of the Investment Tax Credit, as well as the bonus depreciation credit, while beneficial to the long-term health of the industry, has reduced the urgency to complete new solar projects by the end of 2016, with many customers adopting a longer-term timeline for project completion.
- SPWR also says it will cut ~1,200 employees, or 15% of its workforce, mostly associated with closing a facility in the Philippines, and take $30M-$45M in restructuring charges.
Tue, Aug. 9, 4:07 PM