SunPower Corporation (NASDAQ: SPWRA) has already taken a licking and its lowered guidance is not helping. Ditto for an analyst downgrade. JP Morgan dropped the stock from “Overweight” to its least desirable “Underweight” rating. Jefferies has managed to maintain a “Buy” rating but did cut estimates and the price target.
JPMorgan cut its price target from from $28.50 to $15.00. Jefferies cut its target to $40.00 from $50.00. In January, SunPower guided 2009 EPS to $2.20-$2.80. The JPMorgan analyst now sees the company’s EPS at $0.56. Now that’s a significant difference.
Citigroup recently cut its target to $15.00 from $23.00.
The inability of individual and corporate consumers to get financing to help with the purchase of solar panels is a major constraint on the solar industry. SunPower is not immune to that illness. The company is facing a downturn in its European business as well. And now solar has to compete with much more reasonable traditional power prices.
The company’s shares are taking a beating again today with a drop of more than 5% to $22.75. While this is not a 52-week low as its bottom was $18.50, SunPower is down from a 52-week high of $107.00.
Paul Ausick
March 12, 2009
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