UBS Maintains a 'Neutral' on SunPower (SPWRA); Becoming More Dependent on US Market

UBS maintains a 'Neutral' on SunPower (NASDAQ: SPWRA), price target lowered $1 to $18.

UBS analyst says, "Achieving full year 2011 guidance requires big 2H11 ramp in gross margin - SunPower’s 2Q11 results were in line with its negative pre-announcement. SunPower reiterated its 2011 gross margin guidance of 17%-19% which requires 2H11 gross margin to be around 22%. We believe SunPower will benefit from higher sales into its high margin utility projects such as California Valley Solar Ranch (250MW AC) but seeing faster improvements in its module costs to $1.48/watt to offset our estimate of 20% module price decline is still a risk."

"SPWRA guided its 2011 non-GAAP EPS to $0.75-$1.25, down from $1.20-$1.70. Our new 2011 and 2012 EPS estimates (includes stock option expense of $0.40/year) are $0.55 and $1.10 compared to $0.60 and $1.15 previously."

For more ratings news on SunPower click here and for the rating history of SunPower click here.

Shares of SunPower closed at $16.24 yesterday.

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