SunPower Plunges After Delays in Mexico Cut Solar Sale ForecastsBy
Project permitting delays in Mexico pushing sales to 2018
SunPower shares down by the most intraday in almost a year
Two solar farms in Mexico are facing delays that may push sales from those projects into next year, the San Jose, California-based panel maker said. It lowered a range for 2017 sales to between $2.1 billion and $2.3 billion, down from an earlier estimate of as much as $2.6 billion.
Shares tumbled as much as 21 percent, marking the biggest decline since Aug. 10, 2016, and putting an end to the recovery SunPower had been enjoying this year amid improving solar market conditions. While the stock is up 41 percent this year, a global glut of solar panels has kept prices low, squeezing the profits of panel makers like SunPower.
“Given continued market volatility and oversupply,” investors will be closely watching SunPower’s liquidity, Ben Kallo, an energy analyst at Robert W. Baird & Co., said in a research note.
SunPower said it expects panel shipments to total 1.3 to 1.45 gigawatts, down from as much as 1.6, because of the delays in Mexico. The company’s chief executive officer, Thomas Werner, told investors in a call Tuesday that he expected permits for the two projects “soon.”
Werner said he expects SunPower to have about $300 million in cash on hand at the end of the year. The company could end up with even more if it sells its stake in 8point3 Energy Partners LP, a joint venture with First Solar Inc.
First Solar said in April that it planned to sell its stake in the general partner that controls 8point3, an entity with a market value of $1.16 billion. At the time, SunPower hired an adviser to find a new partner and retain its stake. Since then, buyer interest has encouraged SunPower to sell as well.