SunPower beats the street in latest quarter

Leading American solar photovoltaics maker SunPower (NASDAQ: SPWR) yesterday reported strong Q1 results, beating analysts revenue estimate and EPS estimates.

SunPower reported $143.2M in revenue and non-GAAP EPS of $0.29, beating consensus estimates of $130.8M and $0.19. Year-over-year growth in revenue 241%. Gross margins for the quarter were 29%.

The company provided long-term capacity and silicon production guidance. Its lines 8-12 are expected to begin ramping in 2008, bringing year-end total capacity to an estimated 372MW. 2009 silicon contracts are in place for 400MW of production, the company said.

Average selling prices (ASP) were roughly $3.75/W, up 3% increase from the prior quarter. This flies in the face of most analysts' predictions, which expect ASPs in the solar industry will drop in the face of stronger competition and the industry's efforts to open up new markets.

When SPWR announced its acquisition of PowerLight in November (see Solar biz optimistic about SunPower acquisition of PowerLight), the companies touted synergies in cost, distribution, and technology. This quarter's performance seemed to suggest those synergies are developing.

Most analysts covering the stock have maintained their Buy rating, and some are raising their price targets.

"We believe this a must-own name in the solar space as we are becoming even firmer believers in the company's combination with PowerLight," wrote Dave Edwards of ThinkEquity in a note to clients.

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