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What happened

Shares of solar manufacturer SunPower Corporation (SPWR 14.23%) fell 31.7% in August, according to data provided by S&P Global Market Intelligence, after the company reported guidance that severely underwhelmed investors.

So what

Second quarter results weren't bad, but full-year guidance was what investors had their eye on. GAAP net income guidance was reduced from a range of breakeven to a profit of $50 million down to a range of losing $175 million to $125 million. And EBITDA guidance was reduced by $175 million to a range of $275 million to $325 million.

What really concerned investors was early guidance for 2017 of a loss of $100 million to $200 million. There's been fear that 2017 would be slow because utilities aren't feeling much urgency to build solar systems now that the solar investment tax credit has been extended. SunPower said the utility market would be slow as a result, and that couldn't be offset by strength in residential and commercial markets.

Now what

What really threw investors off is that SunPower's management overestimated the projects it would sign and the prices it would sell projects for by the end of the year. And after years of beating expectations, management was in the unusual circumstance of lowering expectations.

To top it off, 2017 might be worse than investors were expecting, calling into question whether or not SunPower has the balance sheet to survive the downturn. And that's why the stock fell as much as it did last month, which may take a while to recover from.