It’s official, the solar industry has been hit with a sad illuminating (pun intended) reality that it’s been propped up on a foundation of sand. What was once an up and comer in the renewable energy industry, with over 700,000 rooftops being powered by solar power, high interest rates and labor market woes are wiping it out for good, with Sunpower being the first victim. 

(Source: Giphy)

If you haven’t been keeping tabs on this stonk, Sunpower has not only taken a nosedive that would make China’s Gold winning divers red with envy as it plummeted a mind boggling 94.75% the past year (down -24.09% just today alone) - but they’ve also officially decided to file for Chapter 11 bankruptcy protection. 

(Source: Canary Media) 

In a statement released Monday, the residential solar panel installer acknowledged its struggles with inventory and high interest rates that are forcing them to sell off listed assets of liabilities between $1 billion and $10 billion - including the selling of it’s Blue Raven Solar and new homes business, along with it’s $165 million non-installing dealer network (whom Complete Solaria bought for only $45 million, pending court approval). 

(Source: Reuters) 

Upon the news of Sunpower’s demise this Tuesday, shares plummeted to a low of 32% taking prices down from 80 cents all the way to 55 cents. Yet, while this is a major blow to SunPower and it’s investors, this is just another stark warning of the current economic landscape we’ve been dealing with since Powell channeled his inner Paul Vlocker two years ago. 

(Source: Bloomberg) 

In the current environment with high interest rates squeezing the life out of the market, combined with everyone hitting the pause button on new installations due to rising costs of living - it’s left companies like SunPower with more inventory than they know what to do with.

Which personally, isn’t much of a shocker considering that once Sunpower stopped leasing panels to homeowners back in July, Guggenheim Securities analyst Joe Osha saw the writing on the wall suggesting that this was a death sentence for the company. 

(Source: Bloomberg)

Plus, throw in the fact that the entire business model is also built on the backs of selling $50k solar roofs to 90 year olds that won’t see an ROI before they kick the bucket… the recipe for disaster is inevitable. 

So given all of this, it’s clear that crap has officially hit the fan for Sunpower as its largest stakeholder, TotalEnergies, regrets not having that mysterious insider information crystal ball that Grandpa Warren has up in Omaha, Nebraska.

(Source: Giphy) 

But as if the Chapter 11 filing wasn’t enough, the SEC has decided to model the “kick a man while he’s down” saying as they’ve issued Sunpower nice subpoena over questionable revenue recognition practices. 

Now of course, accusations are only accusations until proven. However, in a move shocking absolutely no one, Sunpower’s accountant - Ernst & Young - pretty much decided to give us the “guilty as charged” hint as they abandoned SunPower following the subpoena. Because again, nothing says “guilty” when your own accountant grabs his life jacket. 

(Source: Market Watch) 

So with that said, in the end, SunPower is pretty much experiencing a slow, miserable death. With the company’s future now murky at best, this is just another wonderful reminder that tables can drastically turn in a blink of an eye. And now that SunPower is scrambling to secure long-term solutions and mismanagement the best that they can, it’s clear the sun is setting on this once-mighty solar giant. 

(Source: Giphy)

In the end, to all you SunPower investors, you have my condolences. To TotalEnergies, bless your heart and schedule a consultation with Warren Buffett.

Finally, to all you short sellers, congrats… you’ve definitely had a day. Now why don’t you do us all a solid and have a drink for the rest of us why don’t ya? 

(Source: Giphy)

Stocks.News doesn’t hold any positions in companies mentioned in the article.