SunPower Corporation is focused on gaining a firmer foothold in the rapidly expanding European and the Middle Eastern solar market. With this intent the company acquired leading European solar power plant developer – SunRay Renewable Energy. The total consideration for the acquisition is approximately $277 million consisting of approximately $263 million in cash and $14 million in promissory notes.
SunRay with offices spread across Europe and the Middle East will expand SunPower's network. At the same time the acquisition will expand SunPower's project pipeline by more than 1,200 MW of solar photovoltaic (PV) projects in various stages of development in Italy, France, Israel, Spain, the United Kingdom and Greece.
Headquartered in San Jose, California, SunPower designs, develops, manufactures, markets and sells high-performance solar electric power technology products, systems and services worldwide for residential, commercial and utility-scale power plant customers.
SunPower's semiconductor-based solar cells and solar panels, which convert sunlight into electricity, are manufactured using proprietary processes and technologies.
The fortunes of SunPower appear strong, given the reviving prospects of the alternative energy industry, and specifically solar power energy, higher captive generation of panels, rising average conversion efficiency, declining silicon cost and assured silicon supply. Furthermore, state RPS requirements, stimulus plan and ITC grant, increase the visibility of the SunPower story in U.S.
SunPower is also taking steps to replenish its liquidity to offset the Sunray acquisition cost. The company recently announced a $220 million unsecured debenture offering with a coupon rate of 4.5% which closes on Apr 1, 2010.
SunPower may face headwinds in the near term due to oversupply of modules in the market, subsidy risk in Germany and Italy, and receding margins. Also the company recently announced that its Philippines' manufacturing operations understated cost of goods sold by $33.2 million in fiscal 2008 and the first nine months of 2009. SunPower is putting its house in order by implementing financial controls to ensure financial integrity.
SunPower is also trading at a slight premium compared to its peers like Suntech Power Holdings Co. Ltd. and First Solar Inc. – based on forward earnings estimates. Thus we advise investors to keep away from the Zacks Rank #5 stock in the near-term.
SunRay with offices spread across Europe and the Middle East will expand SunPower's network. At the same time the acquisition will expand SunPower's project pipeline by more than 1,200 MW of solar photovoltaic (PV) projects in various stages of development in Italy, France, Israel, Spain, the United Kingdom and Greece.
Headquartered in San Jose, California, SunPower designs, develops, manufactures, markets and sells high-performance solar electric power technology products, systems and services worldwide for residential, commercial and utility-scale power plant customers.
SunPower's semiconductor-based solar cells and solar panels, which convert sunlight into electricity, are manufactured using proprietary processes and technologies.
The fortunes of SunPower appear strong, given the reviving prospects of the alternative energy industry, and specifically solar power energy, higher captive generation of panels, rising average conversion efficiency, declining silicon cost and assured silicon supply. Furthermore, state RPS requirements, stimulus plan and ITC grant, increase the visibility of the SunPower story in U.S.
SunPower is also taking steps to replenish its liquidity to offset the Sunray acquisition cost. The company recently announced a $220 million unsecured debenture offering with a coupon rate of 4.5% which closes on Apr 1, 2010.
SunPower may face headwinds in the near term due to oversupply of modules in the market, subsidy risk in Germany and Italy, and receding margins. Also the company recently announced that its Philippines' manufacturing operations understated cost of goods sold by $33.2 million in fiscal 2008 and the first nine months of 2009. SunPower is putting its house in order by implementing financial controls to ensure financial integrity.
SunPower is also trading at a slight premium compared to its peers like Suntech Power Holdings Co. Ltd. and First Solar Inc. – based on forward earnings estimates. Thus we advise investors to keep away from the Zacks Rank #5 stock in the near-term.
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