Sunpower Reports Mixed Results, But Expects 2nd Half Improvement

| About: SunPower Corporation (SPWR)
This article is now exclusive for PRO subscribers.

Expectations were low going into Sunpower (SPWRA) earnings after the bell yesterday and traders got about what they expected. The company reported mixed results missing on the EPS side reporting a bit wider loss of .19/share vs expectations for a loss of .18/share on revenues of $592 million vs the expectation for $583 million. Despite a 54% jump in revenues over the year ago quarter, the company reported a healthy loss. CEO Tom Werner blamed Europe market conditions for contracting margins, but said strong visibility in the North American utility and power plant business would improve results in the 2nd half of the year.

It’s no surprise then that the company is forecasting soft guidance for this quarter, but stronger guidance for the full year. The company sees revenues for this quarter coming in at $700 – $705 million vs the analyst estimate for $742 million and EPS coming in at .05 – .15 vs the analyst estimate for .21/share. For the full year, the company expects to beat analyst estimates with an EPS in the range of .75 – 1.25 vs the estimate for .70 on revenues of $2.8 – $2.95 billion vs the estimate for $2.76 billion. Whether traders focus on the near term or the longer term will determine where shares of SPWRA head over the next couple weeks, but if history is any indication, traders typically focus around 6 months out, so we could see some improvement in shares following a pull back over the past few weeks. Let’s also keep in mind that SPWRA already warned about this loss a couple weeks ago, so much of it has already been built in.