SunPower Gets a Boost After Earnings

SunPower Corp. (NASDAQ: SPWR) reported second quarter 2015 results after markets closed Tuesday afternoon. For the quarter, the solar panel maker reported adjusted diluted earnings per share (EPS) of $0.18 on adjusted revenue of $376.7 million. In the same period a year ago, SunPower reported EPS of $0.13 on revenue of $430.6 million. Second-quarter results compare to the Thomson Reuters consensus estimates for EPS of $0.17 and $513.07 million in revenue.

Adjusted results include aggregate adjustments totaling $20.7 million, including a negative $4.7 million related to 8point3 Energy Partners LP (NASDAQ: CAFD) initial public offering (IPO), a negative $4.3 million related to utility and power plant projects, a negative $7.1 million related to the First Philippine Solar Corporation arbitration ruling, $14 million related to stock-based compensation expense, $1.9 million related to our November 2014 restructuring plan, $15.2 million related to the 8point3 IPO, $3.9 million related to other adjustments, and $1.8 million related to tax effect.

After declining to give guidance at the end of the first quarter, SunPower issued third-quarter guidance in today’s report. The company expects non-GAAP revenue of $400 to $450 million, gross margin of 10% to 12%, EBITDA of $0 to $15 million, and 300 to 330 deployed megawatts.

On a GAAP basis SunPower expects to post a third-quarter loss per share of $0.50 to $0.60, which includes the impact of the company’s holdco strategy and deferrals due to real estate accounting. The company posted GAAP EPS of $0.04 in the second quarter.

For the full-year SunPower expects non-GAAP revenue of $2.40 billion to $2.60 billion, gross margin of 21% to 23%, net income per diluted share of $1.50 to $1.80, capital expenditures of $250 million to $300 million, and 1,250 to 1,300 megawatts.

The consensus analysts’ estimates for the third quarter call for EPS of $0.34 on revenues of $640.89 million. For the full year analysts are looking for EPS of $1.00 on revenues of $2.2 billion.

The company’s CEO said:

We believe 8point3 Energy Partners will provide us a significant long-term cost of capital advantage and enhance the scale and predictability of our future cash flows. … Our power plant segment remains a key focus for the company and an important contributor to our performance.  Our acquisition of the U.S. solar project development pipeline of Infigen Energy, totaling approximately 1.5 [gigawatts], includes approximately 35 early to late stage solar projects ranging in size up to 100 megawatts (MW) in key regions with expected project build out through 2020.  With our experience of developing and constructing over two gigawatts of solar power plant projects and industry leading technology, we are well positioned to complete these projects. This acquisition also augments our existing portfolio of potential drop down assets for 8point3 Energy Partners.

SunPower’s shares traded up about 1.3% in after-hours trading, at $26.00 in a 52-week range of $22.75 to $39.95. Thomson Reuters had a consensus analyst price target of $40.55 before today’s results were announced.

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