Wedbush Downgrades SunPower (SPWRA) to Hold; Cuts PT to $27

Wedbush Morgan downgrades SunPower (Nasdaq: SPWRA) from Buy to Hold and lowers its price target from $32 to $27.

The firm believes that "credit, average selling prices and poly concerns" have escalated and will continue to given waning investor interest in the solars and an increasing amount of negative industry trends which emerged over Q3.

Specifically, Wedbush feels that a rapid decline in SunPower's average selling prices could impact the company's guidance. Also, the firm sees a lack of financing possibly delaying some of SunPower's projects, "especially larger scale commercial and utility projects." Finally, the firm also notes SunPower's recent change in its customer base, which increases its exposure to currency risk, potentially making earnings more volatile.

Wedbush lowered its GAAP EPS estimate for SunPower's FY08 from $1.07 to $1.01 and its FY09 EPS estimate from $2.27 to $2.22. The Street is currently anticipating FY08 EPS of $2.22 and FY09 EPS of $2.97, although these may not compare as analysts usually use non-GAAP earnings for their estimates.

Shares of SunPower are currently trading up 5% to $31.73. The stock is holding onto a reversal after opening today's trading session nearly 4% lower.

SunPower Corporation engages in the design, manufacture, and marketing of solar electric power technologies.

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