SunPower Corporation (NASDAQ:SPWR) is joining with First Solar to create publicly traded company that will own and operate their solar power assets in an effort to create revenue for its investors. The new entity will be called Yieldco and the capital from it will be used to fund new projects. This joint operation is consistent with the current trends in the industry. The companies will file the registrations with the SEC for an IPO but have not said when or how soon. They also did not say how much they intend to make through the IPO venture.
SunPower is based in California and produces solar systems for homes, offices and utility structures. FirstSolar is based in Arizona and builds solar panels along with solar power plants. FirstSolar recently reported its fourth quarter results and tripled its income over the same period last year. SunPower is set to release earnings soon also.
FirstSolar had just received an $848 million commitment from Apple for its clean energy California Flats Solar Project. Apple will get 130MWfrom the solar project under the deal that covers a 25-year period. There have been rumors that the Yieldco entity might create as much as $100 million in investment dollars for the venture. SunPower is having power supply issues and is starting to build a new manufacturing facility that is expected to be completed this year.
SunPower Corporation (NASDAQ:SPWR) recently reported fourth-quarter net income of $134.7 million. That was a profit of 83 cents per share. The results beat expectations and this bolstered the stock even before the joint-venture IPO was announced. For the year 2014 the company reported revenue of $1.6 billion and a profit of $245 million. This came out to an EPS of $1.55. They raised forecasts for the first quarter to $420 million also.
The stock is starting to create a bullish arrowhead formation and my be ready to come off this level. If it does, the next level would be $40.