Goldman Downgrades SunPower To Neutral Amid A 'Higher Bar' Into 2016

On Tuesday, Goldman Sachs issued a company report on SunPower Corporation SPWR after a recent review of the firm's performance and valuation relative to their peers in the solar industry. Goldman Sachs downgraded SunPower Corporation from Buy to Neutral and raised their price target from $33 to $35.

Justification For Downgrade And Price Target

Brian Lee, Frank He and Hiroyuki Sakaida, analysts at Goldman Sachs, wrote, "Following a November 2015 analyst day that focused more on technology differentiation than financial metrics, we see limited catalysts to drive SPWR shares higher compared to other names in our coverage. Further, we await improved disclosures, particularly on the non-GAAP side and visibility into announced p-type module volume expansion in 2016-2017, to become more constructive again."

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Although Goldman Sachs downgraded SunPower, analysts still believe the company has a diverse market exposure to the solar industry, which could make their stock an attractive investment in the future. Furthermore, Goldman noted that SunPower has showed strength particularly in regards to improving efficiency while simultaneously maintaining a clean balance sheet.

Overall, while SunPower does have risks including higher interest rates and challenges gaining traction abroad, along with a "higher bar" based on past performance, the firm looks to be in a good position for continued growth.

SunPower Corporation closed Monday trading at $30.36.