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SunPower (SPWR) Lags Earnings & Revenue Estimates in Q3

FSLR SPWR CAFD

Trades from $3

SunPower Corp. (SPWR - Free Report) reported third-quarter 2016 adjusted earnings of 56 cents per share, missing the Zacks Consensus Estimate of 67 cents by 16.4%. Reported earnings were, however, much higher than the year-ago figure of 3 cents.

Adjustments were related to the sale of projects to 8point3 Energy Partners (CAFD - Free Report) – a holding company formed in 2015 with First Solar, Inc. (FSLR - Free Report) , sale of operating lease assets, stock-based compensation, amortization of intangible assets, goodwill impairment, restructuring expense, tax effect and other adjustment costs.

On a GAAP basis, the company incurred a loss of 29 cents per share, narrower than the year-ago GAAP loss of 51 cents.
 

Operational Results

During the quarter, SunPower garnered revenues of $770.1 million, missing the Zacks Consensus Estimate of $776 million by 0.8%. Reported revenues, however, surged 74.5% from the year-ago figure of $441.4 million.

The company’s gross margin expanded 230 basis points (bps) to 20% from 17.7% in the prior-year quarter. Total operating expenses were up 30.5% to $139.4 million owing to higher research and development expenses, and restructuring expenses.

SUNPOWER CORP-A Price, Consensus and EPS Surprise

 

SUNPOWER CORP-A Price, Consensus and EPS Surprise | SUNPOWER CORP-A Quote

Financial Position

SunPower had cash and cash equivalents of $383.9 million as of Oct 2, 2016, compared with $954.5 million as of Jan 3, 2016. Long-term debt increased to $455.8 million from $478.9 million at 2015 end.

In the third quarter, net cash outflow was $128.3 million from operating activities, compared to outflow of $103.9 million in the year-ago period.

Guidance

On a non-GAAP basis, the company expects revenues in the range of $1.0–$1.2 billion for the fourth quarter of 2016 and $2.6–$2.8 billion for the full year. Gross margin is estimated to be 1–3% for the fourth quarter and 9–11% for the full year.

SunPower expects to deploy 235–265 megawatts (“MW”) in the fourth quarter and 1,325–1,355 MW in 2016.

A Peer Release

SolarCity Corp. posted an adjusted loss of $2.27 per share in the third quarter of 2016, narrower than the Zacks Consensus Estimate of a loss of $2.35 per share. However, earnings were wider than the year-ago loss of $2.10 per share.

Zacks Rank

Currently, SunPower has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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