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SunPower Corp (SPWR) to Post Q2 Earnings: What's in Store?

SunPower Corporation SPWR is set to report second-quarter 2020 results on Aug 5, after market close.

In the last reported quarter, the company witnessed an earnings surprise of 52.38%. In the trailing four quarters, SunPower came up with an earnings surprise of 196.22%, on average.

Let's take a closer look at the factors influencing the company’s upcoming quarterly results.

Factors at Play

During the first-quarter earnings call, SunPower revealed that the COVID-19 pandemic has started to affect the supply and demand balance in its core markets, since March. As the impact caused by the pandemic continued to deepen in the second quarter, we believe the disruption to have once again impacted the company's top-line performance in the soon-to-be-reported quarter. Since the COVID-19 pandemic induced stringent travel restrictions and curbed economic activities across the globe, shipment and timely delivery of SunPower’s products mighthave also been hampered in the second quarter, thereby weighing on its revenues.

The Zacks Consensus Estimate for second-quarter sales is pegged at $315 million, which indicates a 34.7% decline from the year-ago quarter’s reported figure.

Majority of SunPower’s factories remained idle for the most part of April, courtesy of the virus outbreak. Therefore, the company is likely to have incurred notable idle facility costs in the second quarter. Moreover, the company has been facing certain challenges in terms of project execution, which led to delays, thereby pushing up fixed costs. These expenses are likely to have affected its second-quarter bottom-line performance.

The Zacks Consensus Estimate for the company’s second-quarter loss is pegged at 42 cents per share, wider than the year-ago quarter’s reported loss of 22 cents.

Earnings Whispers

Our proven model does not predict an earnings beat for SunPower this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But this is not the case here.

Earnings ESP: The company’s Earnings ESP is -10.40%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: SunPower currently carries a Zacks Rank #4 (Sell).

SunPower Corporation Price and EPS Surprise

SunPower Corporation Price and EPS Surprise

SunPower Corporation price-eps-surprise | SunPower Corporation Quote

Upcoming Solar Releases

Canadian Solar CSIQ carries a Zacks Rank #2, at present, and is scheduled to post second-quarter 2020 results on Aug 7. You can see the complete list of today’s Zacks #1 Rank stocks here.

First Solar FSLR currently has a Zacks Rank #3 and is set to release second-quarter 2020 results on Aug 6.

Vivint Solar VSLR is presently a Zacks #3 Ranked stock and is scheduled to post second-quarter 2020 results on Aug 5.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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