SunPower disaster (NASDAQ:SPWR) continues, analysts declare the company worthless

It’s a dark day when an analyst says your company’s equity no longer has any value. And that’s exactly what happened to SunPower (SPWR), the solar stock that could be on the verge of collapse. Analysts came down hard on the stock, and investors abandoned ship, sending shares down over 48% on Friday afternoon.

The carnage began yesterday but continued into today with such a fever that it was essentially a typhoon. That’s when Guggenheim analysts Hilary Cauley and Joseph Osha stepped forward and dealt the company a death blow, declaring: “We believe this effectively means the end of SPWR as an operating company. Given the debt the company has accumulated, we believe SPWR’s equity no longer has any value.”

Guggenheim then followed through on its price targets, cutting them from $1 to $0, effectively declaring the company worthless. SunPower, meanwhile, recently announced that it would no longer support new leases, installations or product deliveries, raising the question of where its operating income would come from.

Is there hope for tomorrow?

SunPower is reportedly currently looking for new suppliers to whom it can transfer projects it has already sold. There is also hope that SunPower will be bought out by another company, which could be comparatively cheap, especially if the new owner can convince creditors to accept a reduced or delayed payment.

While work has been halted, other analysts are circling the body in waiting. Roth analyst Philip Shen said the company may have “hit a wall,” and BloombergNEF analyst Pol Lezcano noted the company is essentially unable to continue operations. And GLJ Research, like Guggenheim, cut its price target to $0.

Is SunPower stock a good buy?

As for Wall Street, analysts have issued a consensus recommendation of “Moderate Sell” for SPWR stock, based on five “Hold” and four “Sell” recommendations over the past three months, as shown in the chart below. After a 93.17% loss in the past year, SPWR’s average price target of $3.01 per share implies an upside potential of 293.46%.

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