Analyst Explains Why They SunPower Corp Downgrade Their SunPower Corp Rating

By Ryan Adsit

Oppenheimer analyst Colin Rusch downgraded SunPower Corp (NASDAQ: SPWR) to Hold today. The company’s shares closed yesterday at $7.48.

Rusch said:

“While SPWR appears to be navigating the Section 201 process judiciously and proactively monetizing project assets to de-lever the balance sheet, we believe uncertainty on cost structure and possible restructuring warrants stepping to the sidelines on SPWR shares for now. As management works through its strategic planning process, we believe investors will gain clarity on manufacturing margins and Section 201 tariffs in ~60-90 days. We believe SPWR has meaningful opportunities for optimizing its business and has proven effective historically evolving with the gyrations of the solar industry. We continue to be bullish on SPWR’s Helix and Equinox products. If SPWR can obtain an exemption from Section 201 tariffs and clarify its cost reduction path, we would look to get more constructive on shares.”

According to TipRanks.com, Rusch is a 4-star analyst with an average return of 5.7% and a 47.5% success rate. Rusch covers the Industrial Goods sector, focusing on stocks such as Capstone Turbine Corp, Amer Superconductor, and Canadian Solar Inc.

SunPower Corp has an analyst consensus of Moderate Buy, with a price target consensus of $10.

Based on SunPower Corp’s latest earnings report for the quarter ending December 31, the company posted quarterly revenue of $658 million and GAAP net loss of $569 million. In comparison, last year the company earned revenue of $1.02 billion and had a GAAP net loss of $275 million.

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SunPower Corp. engages in the design, manufacture, and deliver of solar panels and systems. It operates through the following segments: Residential, Commercial, and Power Plant. The Residential segment refers to the sales of solar energy solutions to residential end customers through a variety of means.