SunPower Stock Is Tumbling. The Solar-Panel Maker Is Restating Results.

“The company preliminarily determined that the value of consignment inventory of microinverter components at certain third-party locations had been overstated in the Affected Periods in the range of approximately $16 million to $20 million, resulting in the associated cost of revenue being understated,” the company said in the filing.

SunPower
hasn’t completed its review, and said that the expected financial impact of the errors was subject to change. The company also said that it determined a “material weakness exists in the company’s internal control over financial reporting.”

The company said it would provide more details with the third-quarter report on Nov. 1.

SunPower stock was tumbling 18% to $4.07 and was on pace for its largest percentage decrease since March 2020 and lowest close since April 2020, according to Dow Jones Market Data.

Truist Securities analyst Jordan Levy wrote in a research note that while the news likely represents yet another blow to sentiment around the residential solar space, “we do see the issue as being specific to the company with minimal read-thrus for others in the space.” He rates the stock as a Hold with a price target of $6.

Other solar energy stocks were dropping Wednesday.
Sunrun
(RUN) was falling 5.8%,
SolarEdge Technologies
(SEDG) was down 4.6%, and
First Solar
(FSLR) declined 2.1%.

The restatements are the latest set of problems for SunPower amid a broad hit to the solar industry this year. Rising interest rates have dented demand as financing bigger home-improvement projects has become more expensive.

Before reporting second-quarter results, the company in July slashed its fiscal-year guidance, citing a steeper-than-expected drop in customer demand.

SunPower stock has plunged 77% this year, and was on pace for its worst year since 2016.

Write to Angela Palumbo at [email protected]