SunPower (SPWR) Tops Q4 Earnings Estimates, Revenues Lag

SunPower Corp. (NASDAQ:SPWR) reported fourth-quarter 2017 adjusted earnings of 25 cents per share, which surpassed the Zacks Consensus Estimate of 18 cents by 38.9%. In the year-ago period, the company reported earnings of 2 cents per share.

The results include adjustments related to cost of above-market polysilicon.

On a GAAP basis, the company incurred a loss of $4.07 per share, wider than the year-ago loss of $1.99.

For 2017, SunPower reported adjusted loss of 25 cents per share, as against earnings of 60 cents in the prior year. The full-year adjusted earnings also came in narrower than the Zacks Consensus Estimate for loss of 36 cents.

Operational Results

During the quarter, SunPower garnered adjusted revenues of $824 million that missed the Zacks Consensus Estimate of $838 million by 1.7%. Moreover, reported revenues declined 24.9% from the year-ago figure of $1097.3 million.

For 2017, the company generated adjusted revenues worth $2,128.6 million, which also lagged the Zacks Consensus Estimate of $2,140 million. Moreover, on a year-over-year basis, revenues fell 21.2% from $2,702.9 billion in the prior year.

Total operating expenses were up by a whopping 170.3% to $719.4 million due to higher selling, general and administrative expenses and impairment of residential lease assets.

Financial Position

SunPower had cash and cash equivalents of $435 million as of Dec 31, 2017 compared with $425.3 million as of Jan 1, 2017. Long-term debt dropped to $430.6 million from $451.2 million at 2016-end.

In the fourth quarter, net cash inflow was $47.9 million from operating activities compared with $486.1 million in the year-ago period.

Guidance

On a non-GAAP basis, the company expects adjusted revenues in the range of $300-$350 million for first-quarter 2018. Adjusted Gross margin is estimated to be in 4-6% range for the quarter.

SunPower currently anticipates adjusted revenues for 2018 to lie in the range of $1.8-$2.2 billion.

The company expects to deploy 275-305 megawatts in the first quarter and 1.37-1.40 gigawatts (GW) in 2018.

SunPower Corporation Price, Consensus and EPS Surprise

SunPower carries a Zacks Rank #4 (Sell).

A better-ranked stock in the same sector is First Solar (NASDAQ:FSLR) carrying a Zacks Rank 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

First Solar surpassed the Zacks Consensus Estimate in the trailing four quarters with an average beat of 537.39%. Also, Zacks Consensus Estimate for 2018 rose by 36 cents in the last 90 days.

Upcoming Peer Releases

JA Solar Holdings (NASDAQ:JASO) is scheduled to release fourth-quarter 2017 results on Mar 15. JA Solar Holdings surpassed the Zacks Consensus Estimate in two of the trailing four quarters with an average positive
earnings surprise of 574.07%.

Sunrun (NASDAQ:RUN) is scheduled to release fourth-quarter 2017 results on Mar 6. Sunrun surpassed the Zacks Consensus Estimate in the trailing four quarters with an average positive earnings surprise of 75.67%.

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