What happened
SunPower (SPWR +0.00%) stock fell 15.2% in July, according to data provided by S&P Global Market Intelligence. The stock continued its fall this month and was already down 7% by Aug. 4. SunPower stock fell 9% on Wednesday, after the company announced lackluster second-quarter results.
So what
SunPower stock's fall in July is likely attributed to an underperform rating by Credit Suisse. On July 13, Credit Suisse analyst Maheep Mandloi assigned an underperform rating to SunPower stock. He also gave a price target of $22 for the stock. The next day, the stock fell 14.6%. Moreover, on July 15, Piper Sandler analyst Kashy Harrison lowered his price target for SunPower from $28 to $26.
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Solar stocks broadly have seen some correction this year. In July, the Invesco Solar ETF fell 4.1%. Analysts' downbeat sentiments for SunPower likely added to its steeper fall. Additionally, SunPower stock soared steeply in 2020 and in January this year, outperforming peers like Sunrun and Sunnova Energy Inernational. The share price rose above $54 in January.
So, the fall in the last six months reflects some profit taking by investors who felt the stock had run a bit too high.
Now what
SunPower's second-quarter revenue of $309 million fell short of consensus estimates and was toward the lower end of the company's guided range of $295 million to $345 million for the quarter. SunPower also gave revenue guidance of $1.41 billion to $1.49 billion for fiscal year 2021, which was slightly lower than the company's previous guidance of over $1.5 billion in revenue for the year.
Management attributed the change to some of its commercial and industrial projects being pushed into 2022. Though that sounded reasonable, some investors decided not to wait that long and headed for the exits.
