SunPower Surges as Third-Quarter Results Beat Expectationsby
Shares rise as analysts predict sales growth next year
Solar company planning to sell power plants to 8point3
SunPower Corp., the second-biggest U.S. solar manufacturer, rose the most in eight months after reporting third-quarter results that beat analyst expectations.
SunPower increased 11 percent to $27.36 at the close in New York, the biggest gain since Feb. 24.
For the third quarter, San Jose, California-based SunPower reported profit excluding some items of 13 cents a share, beating the average of 14 analysts’ estimates compiled by Bloomberg that called for a break-even quarter.
“SunPower beat estimates across the board,” Ben Kallo, an analyst at Robert W. Baird & Co. in San Francisco, said in a note to clients Thursday. He has the equivalent of a buy rating. “The share price will catch up with fundamentals over the coming months.”
The company’s sales have declined as it holds onto power plants, instead of selling them to other companies. SunPower expects to shift some projects to 8point3 Energy Partners LP, a holding company formed this year with First Solar Inc. SunPower may also sell some solar farms to other buyers, and that’s positioned the company for growth next year, said Jeffrey Osborne, an analyst at Cowen & Co. in New York.
“We like the company’s flexibility in being able to strategically move supply to higher margin markets and accelerating projects designated for 8point3,” Osborne said in a note to clients.