Short Sellers Not Buying Into SunPower's Outlook

• Analyst reactions to this solar company's results were mixed.
• But short interest has been on the rise in recent periods.
• The share price fell between the most recent settlement dates.

The better than expected fourth-quarter revenue and the guidance from SunPower Corporation SPWR may have garnered it an upgrade from Oppenheimer, but Credit Suisse seems more skeptical, maintaining its Neutral rating.

The former sees the solar company's challenging operating conditions as priced in to shares, while the latter believes 2017 profitability could be worse than expected. The short sellers don't seem to be convinced either. As of the most recently reported period, short interest was almost a third of the company's total float.

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Between the December 30 and January 13 settlement dates, this San Jose-based solar energy company saw the number of its shares short rise fractionally to around 18.71 million. But that represents a whopping 31.9 percent of the total float, and the number of shares short has been greater in only one period in the past year. The average daily trading volume fell during the most recent period, and the number of days it would take to cover all short positions rose to seven.

Duke Energy bought three solar projects from SunPower earlier this month. SunPower's share price ended the two-week short interest period almost 11 percent lower, though it was down nearly 14 percent at one point. The Nasdaq also gained less than 1 percent in that time. The stock recovered somewhat afterward, then plunged more than 9 percent early Thursday. The consensus recommendation of analysts polled by Thomson/First Call is to hold shares.