Please ensure Javascript is enabled for purposes of website accessibility

Why SunPower Corporation's Shares Jumped 14.4% Today

By Travis Hoium – May 10, 2019 at 12:28PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The solar business may be better than expected in 2019.

What happened 

Shares of SunPower Corporation (SPWR -1.95%) jumped as much as 14.4% in trading Friday after the solar manufacturer reported first-quarter 2019 results. Shares gave back some of those gains midday, but at 12:15 p.m. EDT shares were still up 9.5% on the day. 

So what

Quarterly revenue was $348.2 million and net loss was $89.7 million, or $0.63 per share on a GAAP (generally accepted accounting principles) basis. On a non-GAAP basis, revenue was $411.6 million and the loss was $57.4 million, or $0.41 per share. Adjusted EBITDA was negative $23.8 million, down from a gain of $32.3 million a year ago. 

Carport with solar panels.

Image source: SunPower Corporation.

Management also said it continues to expect 1.9 to 2.1 gigawatts of solar deployed with $1.9 to $2.0 billion of non-GAAP revenue for 2019. What investors likely gravitated to was management increasing the lower end of adjusted EBITDA guidance for 2019 from $80 million to $90 million, while keeping the $110 million top end of the range the same. 

Now what

There weren't any huge surprises in the quarter, but investors are likely relieved that operating conditions are expected to get better as the year goes on. The solar industry has been very competitive in the last few quarters, and price wars can lead to lower margins across the board. SunPower says it's expecting margins to improve as new high-efficiency solar panels are rolled out and U.S. residential and commercial markets grow. That's why there's optimism today, and now the company needs to execute on rising expectations. 

Travis Hoium owns shares of SunPower. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

SunPower Corporation Stock Quote
SunPower Corporation
SPWR
$24.69 (-1.95%) $0.49

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
329%
 
S&P 500 Returns
106%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/25/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.