TheStreet Ratings team rates SUNPOWER CORP as a Hold with a ratings score of C. The team has this to say about their recommendation:
"We rate SUNPOWER CORP (SPWR) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we find that the company's profit margins have been poor overall."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Powered by its strong earnings growth of 278.04% and other important driving factors, this stock has surged by 321.14% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- SUNPOWER CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, SUNPOWER CORP continued to lose money by earning -$3.01 versus -$6.14 in the prior year. This year, the market expects an improvement in earnings ($1.41 versus -$3.01).
- SPWR's debt-to-equity ratio of 0.89 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.98 is weak.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, SUNPOWER CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for SUNPOWER CORP is currently lower than what is desirable, coming in at 25.26%. Regardless of SPWR's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 16.49% trails the industry average.
- You can view the full analysis from the report here: SPWR Ratings Report