Shares of SunPower Corporation (NASDAQ:SPWR) jumped 18.7% in June, according to data provided by S&P Global Market Intelligence, as conditions in the solar industry got better and there was speculation SunPower could power Trump's border wall.
The fundamentals appear to be getting better ahead of second quarter earnings. Project values are rising as interest rates and buyers' rate of return demands fall, which should lead to more revenue for projects SunPower sells this year. And solar panel prices are up on the back of strong demand in the U.S., which should help second and third quarter results.
While fundamentals appear to be improving, what pushed SunPower higher last month was Donald Trump's talk of putting solar on the border wall. SunPower is one of a small number of potential suppliers for the solar wall and if it's ever built it could soak up three or four years of the company's production. Of course, it doesn't appear the wall will be built, despite the market's reaction this week.
You may notice that all of the factors driving SunPower up are speculation at the moment. But that speculation will turn into more concrete results late in July or in early August when the company reports second quarter results. Investors will be hoping that results not only beat expectations but also that management sees increasing prices and demand for high efficiency solar panels in the second half of 2017 and into 2018. That's what will keep driving the stock higher and after June's big gains we know to watch for positive progress on project values, panel pricing, and any news on the border wall during the second quarter earnings call.