Sunpower Delivers Another Ho Hum Quarter
EnerTuition • 16 Comments
EnerTuition • 16 Comments
Today, 2:21 PM
- SunPower's (SPWR -4.7%) new restructuring plan is indicative of worsening solar photovoltaic market fundamentals, Axiom’s Gordon Johnson says.
- The analyst says SPWR thinks the U.S. residential market has “corrected” while he believes the correction seems “far from over," manufacturers continue to expand capacity causing price competition that is driving ASPs to new lows, lower cost targets translate to lower growth given the capital intensity of SPWR's PV projects.
- Johnson has Sell ratings on SunEdison (OTCPK:SUNEQ -5.8%), JA Solar (JASO -4%), Trina Solar (TSL), Yingli Green Energy (YGE -3.1%) and SolarEdge (SEDG -2.1%).
- Morgan Stanley says it remains cautious on the 2017 outlook given limited indications of a PV industry recovery, also noting that SPWR did not provide margin or EBITDA targets and said it would focus on maximizing cash flow and liquidity rather than to growth; the firm rates SPWR at Equal Weight with a $6 price target.
Yesterday, 3:01 PM
Yesterday, 12:50 PM
Yesterday, 8:18 AM
- SunPower (NASDAQ:SPWR) +4.3% premarket after announcing a restructuring plan it says will generate positive cash flow from operations through the end of FY 2017.
- SPWR says it plans to reduce its global workforce by ~25%, or 2,500 employees; cut 2017 operating expenses to less than $350M and capex by more than 50% to ~$100M; close its 700 MW nameplate capacity Fab 2 facility; and substantially decrease 2016 inventory to improve working capital and de-lever its balance sheet.
- As a result of the announced and previous initiatives, SPWR expects to record at least $150M in restructuring charges on a GAAP basis in Q4 and incur total restructuring charges of $225M-$275M through year-end 2017.
- SPWR also projects 2017 revenue of $1.8B-$2.3B on a GAAP basis and $2.1B-$2.6B on a non-GAAP basis, vs. analyst consensus $2.48B.
Thu, Nov. 17, 1:20 PM
- SunPower (SPWR -3.9%) is downgraded to Neutral from Outperform with a $7 price target, slashed from $12, at Baird, which says it underestimated the extent and duration of the solar market oversupply, and now thinks the industry will continue to deteriorate and remain in a glut for at least four more quarters.
- Baird believes rapid ASP declines could make it difficult for SPWR's highly efficient modules to command premium pricing.
- SPWR shares also surely are weighed by First Solar's unexpectedly weak 2017 guidance and potential restructuring effects.
- Separately, SPWR says it sold a controlling interest in the 100 MW Boulder Solar I Facility in Nevada to Southern Co. (SO -0.7%); no other financial details were provided.
Wed, Nov. 16, 5:36 PM
Fri, Nov. 11, 11:28 AM
- SunPower (SPWR -0.7%) is downgraded to Neutral from Buy with a $7 price target, slashed from $13, at UBS, following disappointing Q3 results and a reduced full-year revenue outlook.
- The firm says that despite its initial thesis that shares were close to a near-trough valuation, multiple guidance revisions over several months and an "extremely challenging macro environment" have showed that "even the highest quality product in a commodity space is still subject to the same pressures, regardless of temporary offsets like legacy projects and restructuring actions."
- UBS also says lower panel prices could still have a knock on effect on the ability to sell at SPWR's historically premium prices.
Wed, Nov. 9, 5:44 PM
- SunPower (NASDAQ:SPWR) -3.1% AH after reported better than expected Q3 earnings but smaller than expected revenues, adding that it will cut costs to meet the current market environment.
- SPWR expects the cost-cutting measures to improve margins and reduce 2017 annual operating expenses to ~$350M.
- SPWR says that "while prospects for long-term solar industry growth remain strong, we are seeing a significant near-term market dislocation in the solar market that we expect will impact our financial performance through 2017."
- The company cuts its full-year revenue forecast to $2.6B-$2.8B from its earlier view of $3B-$3.2B, while expecting to deploy 1.325-1.355 GW vs. its previous forecast of 1.45-1.65 GW.
Wed, Nov. 9, 4:07 PM
Wed, Nov. 9, 3:05 PM
Wed, Nov. 9, 10:14 AM
- Solar stocks (TAN -5.4%) are among this morning's biggest losers ahead of a new Trump administration that likely will favor traditional energy sources over alternatives.
- "Trump would allocate more resources to traditional energy sectors (oil, gas and coal) than would Clinton, but allocate less to alternative energy industries,” says Mickey Levy, chief economist for the Americas and Asia at Berenberg.
- SPWR -13.9%, RUN -7.7%, VSLR -6.2%, FSLR -5.7%, SCTY -5.3%, JASO -4.2%, TSL -2.3%.
Tue, Nov. 8, 5:35 PM
- APPS, APU, ATHX, ATO, CALL, CHMI, COTV, CPST, CSRA, CUI, CYTX, DIOD, ECPG, ECYT, EGAN, ENS, ETE, ETP, EVH, EVOK, EVRI, FF, FLO, FR, GALE, GDOT, GLF, HLIT, ICUI, INFI, JUNO, MACK, MIME, MNKD, MNTX, MRIN, MYL, NNI, NTES, NVAX, OMER, PAHC, PLKI, PRI, QHC, QNST, RBA, RELY, RPD, RTK, SEDG, SGRY, SHAK, SLF, SLW, SPTN, SPWR, SREV, SUN, SXL, TASR, TCRD, TCS, TPIC, TTEC, TTEK, TTGT, TUBE, UGI, UHAL, VRTU, VVUS, WAGE, WUBA, XON, XONE, YUME, ZLTQ
Thu, Nov. 3, 6:54 PM
- Prices of solar stocks (NYSEARCA:TAN) tumbled into a black hole today following severely bearish comments from First Solar's (NASDAQ:FSLR) earnings conference call, as it reduced its 2016 forecast for sales and shipments, and cut its capital spending budget.
- FSLR says module pricing “declined at a dramatic rate” in Q3 as other module manufacturers continue to bring new capacity online amid demand dropoff in China, which has led to oversupply and growing inventories.
- JMP Securities maintains a Market Underperform rating on FSLR with a $32 price target, noting that FSLR beat consensus Q3 earnings but was due to non-operating factors, and management's commentary suggests it will take "aggressive steps" to reposition its cost structure in a tough pricing environment.
- Patrick Pouyanne, CEO of Top SunPower shareholder Total (NYSE:TOT), said at a conference in Paris that solar is facing overcapacity and lack of demand, and that “we have to find a way to make renewable businesses profitable.”
- In today's trade: FSLR -14.9%, SPWR -10.5%, CSIQ -10.7%, SKYS -12.1%, CAFD -1.5%.
Wed, Oct. 26, 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%.