SunPower Corporation reports 2,044% Net Income growth in 2020 and 5.1 pp EBITDA Margin growth from -0.073% to 5.0%
02/17/2021 • About SunPower Corporation (
$SPWR) • By InTwits
SunPower Corporation reported FY2020 financial results today. Here are the key drivers of the company's long term financial model:
- SunPower Corporation is a company in decline: FY2020 revenue growth was -39.7%, 5 years revenue CAGR was -6.5%
- EBITDA Margin is expanding: 5.0% in FY2020 vs. -0.1% in FY2019 vs. -11.3% in FY2016
- SunPower Corporation spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for FY2016-FY2020 is 0.0%. Average EBITDA Margin for the same period was -19.8%
- SunPower Corporation has low CAPEX intensity: 5 year average CAPEX/Revenue was 3.5%. At the same time it's a lot of higher than industry average of 3.2%.
- CAPEX is quite volatile: $15m in FY2020, $47m in FY2019, $45m in FY2018, $70m in FY2017, $187m in FY2016
- The company has unprofitable business model: ROIC is -0.1%
- It operates with high leverage: Net Debt/EBITDA is 8.2x while industry average is 0.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue dropped on 39.7%. Revenue decline showed acceleration in FY20Q4 - it was 43.4% YoY. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin increased on 5.1 pp from -0.073% to 5.0% in FY2020. During FY2016-FY2020 EBITDA Margin bottomed in FY2017 at -46.8% and was growing since that time.
Gross Margin increased on 8.1 pp from 6.8% to 14.9% in FY2020. During FY2016-FY2020 Gross Margin bottomed in FY2018 at -17.2% and was growing since that time. SG&A as a % of Revenue increased slightly on 0.67 pp from 14.0% to 14.6% in FY2020.
Net Income margin surged on 41.0 pp from 1.2% to 42.2% in FY2020. During FY2016-FY2020 Net Income margin bottomed in FY2017 at -51.8% and was growing since that time.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 1.3% in FY2020. The company showed decline in CAPEX/Revenue of 2.6 pp from 3.9% in FY2017 to 1.3% in FY2020. Average CAPEX/Revenue for the last three years was 2.1%. CAPEX as a % of Revenue stuck to a declining trend at -1.3 pp per annum in the last 5 years.
Return on investment
The company operates at negative ROIC (-0.1%) and low but positive ROE (229.3%). ROIC increased on 9.6 pp from -9.7% to -0.097% in FY2020. During FY2016-FY2020 ROIC bottomed in FY2018 at -54.2% and was growing since that time.
Leverage (Debt)
Debt level is 8.2x Net Debt / EBITDA and 12.3x Debt / EBITDA. Net Debt / EBITDA jumped8.2x from to 8.2x in FY2020. Debt dropped on 36.8% while cash dropped on 45.0%.
SunPower Corporation has no short term refinancing risk: cash is higher than short term debt (137.5%).
Valuation and dividends
The company's trades at EV/EBITDA 122.5x and P/E 13.5x.
Management team
SunPower Corporation's CEO is Thomas H Werner "Tom". Thomas H Werner "Tom" has 17 years tenure with the company. The company's CFO is Manavendra S Sial. Manavendra S Sial has 2 years tenure at the company.
Financial and operational results
FY ended 01/03/2021
SunPower Corporation ($SPWR) key annual financial indicatorsmln. $ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
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P&L
|
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Revenue | 2,560 | 1,794 | 1,726 | 1,864 | 1,125 | -39.7% |
Gross Profit | 190 | -19 | -297 | 126 | 167 | 32.7% |
SG&A | 329 | 279 | 260 | 260 | 165 | -36.8% |
EBITDA | -288 | -840 | -722 | -1 | 56 | |
Net Income | -471 | -929 | -811 | 22 | 475 | 2,043.8% |
Balance Sheet
|
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Cash | 425 | 435 | 309 | 423 | 233 | -45.0% |
Short Term Debt | 71 | 358 | 40 | 114 | 169 | 48.1% |
Long Term Debt | 1,565 | 1,247 | 859 | 980 | 522 | -46.7% |
Cash flow
|
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Capex | 187 | 70 | 45 | 47 | 15 | -69.2% |
Ratios
|
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Revenue growth | 62.4% | -29.9% | -3.8% | 8.0% | -39.7% | |
EBITDA growth | 322.0% | 191.3% | -14.0% | -99.8% | -4,204.4% | |
|
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Gross Margin | 7.4% | -1.0% | -17.2% | 6.8% | 14.9% | 8.1% |
EBITDA Margin | -11.3% | -46.8% | -41.8% | -0.1% | 5.0% | 5.1% |
SG&A, % of revenue | 12.9% | 15.5% | 15.1% | 14.0% | 14.6% | 0.7% |
Net Income Margin | -18.4% | -51.8% | -47.0% | 1.2% | 42.2% | 41.0% |
CAPEX, % of revenue | 7.3% | 3.9% | 2.6% | 2.5% | 1.3% | -1.2% |
|
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ROIC | -15.2% | -39.3% | -54.2% | -9.7% | -0.1% | 9.6% |
ROE | -38.3% | -116.4% | | | 229.3% | |
Net Debt/EBITDA | | | | | 8.2x |
SunPower Corporation ($SPWR) key quoterly financial indicators
mln. $ | FY20Q1 | FY20Q2 | FY20Q3 | FY20Q4 | | YoY change |
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P&L
|
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Revenue | 449 | 353 | 275 | 342 | | 29.0% | -19.1% | -3.9% | -43.4% |
EBITDA | -23 | -16 | 13 | 30 | | - | -117.8% | - | 23.6% |
Net Income | -1 | 19 | 45 | 412 | | - | -84.0% | - | 7,482.3% |
Balance Sheet
|
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Cash | 205 | 235 | 325 | 233 | | 10.7% | 40.7% | 71.8% | -45.0% |
Short Term Debt | 136 | 450 | 408 | 169 | | 170.4% | 531.7% | 358.6% | 48.1% |
Long Term Debt | 882 | 566 | 535 | 522 | | -4.1% | -41.1% | -41.4% | -46.7% |
Ratios
|
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Gross Margin | 8.3% | 6.1% | 13.5% | 22.0% | | 19.0% | 1.6% | -2.4% | 6.2% |
EBITDA Margin | -5.1% | -4.7% | 4.8% | 8.8% | | 20.4% | -25.8% | 5.5% | 4.8% |
Net Income Margin | -0.3% | 5.5% | 16.2% | 120.7% | | 25.4% | -22.3% | 21.5% | 119.8% |
Peers in Semiconductors
Below we provide SunPower Corporation benchmarking against other companies in Semiconductors industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
---|
Inphi Corporation ($IPHI) | - | 30.8% | -15.4% | 24.2% | 86.8% |
Sequans Communications S.A. ($SQNS) | - | 5.9% | -16.6% | -23.3% | 65.0% |
MaxLinear, Inc ($MXL) | - | 8.4% | -8.4% | -17.6% | 50.9% |
Advanced Micro Devices, Inc. ($AMD) | - | 21.6% | 23.3% | 4.0% | 45.0% |
Kopin Corporation ($KOPN) | - | 23.0% | -12.1% | 20.7% | 35.9% |
|
---|
Median (43 companies) | 1.2% | 11.0% | 4.9% | -3.2% | 2.8% |
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SunPower Corporation ($SPWR) | - | -29.9% | -3.8% | 8.0% | -39.7% |
Top companies by Gross margin, %
Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
---|
CEVA, Inc. ($CEVA) | 91.6% | 92.1% | 89.8% | 88.4% | 89.3% |
Universal Display Corporation ($OLED) | 83.9% | 80.8% | 75.5% | 78.5% | 80.1% |
Rambus, Inc. ($RMBS) | 80.1% | 79.9% | 76.8% | 77.1% | 75.0% |
Analog Devices, Inc. ($ADI) | 65.1% | 59.9% | 68.3% | 67.0% | 65.9% |
MoSys, Inc. ($MOSY) | 49.0% | 46.9% | 61.8% | 61.0% | 65.7% |
|
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Median (43 companies) | 48.0% | 49.1% | 50.4% | 50.7% | 49.4% |
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SunPower Corporation ($SPWR) | 7.4% | -1.0% | -17.2% | 6.8% | 14.9% |
Top companies by EBITDA margin, %
Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
---|
Texas Instruments Incorporated ($TXN) | 43.5% | 46.7% | 48.6% | 47.5% | 47.6% |
Intel Corp ($INTC) | 35.2% | 41.7% | 45.7% | 45.9% | 46.7% |
Broadcom Inc. ($AVGO) | 19.9% | 40.4% | 44.2% | 40.9% | 46.2% |
Universal Display Corporation ($OLED) | 44.8% | 51.6% | 35.3% | 48.0% | 45.9% |
Analog Devices, Inc. ($ADI) | 36.2% | 32.1% | 43.2% | 42.1% | 42.0% |
|
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Median (41 companies) | 9.2% | 10.7% | 9.8% | 13.6% | 17.4% |
---|
SunPower Corporation ($SPWR) | -11.3% | -46.8% | -41.8% | -0.1% | 5.0% |
Top companies by CAPEX/Revenue, %
Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
---|
Micron Technology, Inc. ($MU) | 46.9% | 23.3% | 29.2% | 41.8% | 38.4% |
Sequans Communications S.A. ($SQNS) | 11.8% | 13.3% | 22.9% | 29.6% | 27.1% |
Intel Corp ($INTC) | 16.2% | 18.8% | 21.4% | 22.5% | 18.6% |
First Solar, Inc. ($FSLR) | 7.9% | 17.5% | 33.0% | 21.8% | 15.4% |
Power Integrations, Inc. ($POWI) | 3.1% | 7.5% | 5.9% | 5.7% | 14.5% |
|
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Median (40 companies) | 3.6% | 4.7% | 4.4% | 3.8% | 4.0% |
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SunPower Corporation ($SPWR) | 7.3% | 3.9% | 2.6% | 2.5% | 1.3% |
Top companies by ROIC, %
Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
---|
Texas Instruments Incorporated ($TXN) | 34.9% | 43.1% | 47.5% | 39.7% | 38.2% |
Applied Materials Inc ($AMAT) | 19.0% | 31.2% | 36.4% | 27.7% | 32.1% |
Advanced Micro Devices, Inc. ($AMD) | -21.7% | 7.3% | 21.6% | 21.5% | 31.8% |
QUALCOMM Incorporated ($QCOM) | 15.8% | 5.7% | 2.2% | 38.0% | 28.1% |
NVIDIA Corporation ($NVDA) | 13.1% | 27.3% | 35.3% | 36.9% | 22.7% |
|
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Median (45 companies) | 1.7% | 3.2% | 3.0% | 3.8% | 5.5% |
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SunPower Corporation ($SPWR) | -15.2% | -39.3% | -54.2% | -9.7% | -0.1% |
Top companies by Net Debt / EBITDA
Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
---|
MACOM Technology Solutions Holdings, Inc. ($MTSI) | 3.0x | 7.2x | 98.6x | - | 6.6x |
Rambus, Inc. ($RMBS) | -0.1x | -0.1x | - | - | 5.9x |
Inphi Corporation ($IPHI) | 4.5x | 33.7x | 32.2x | 4.5x | 3.4x |
Canadian Solar Inc. ($CSIQ) | 11.3x | 6.8x | 2.7x | 3.4x | 3.3x |
Broadcom Inc. ($AVGO) | 4.0x | 0.9x | 1.4x | 3.0x | 3.1x |
|
---|
Median (31 companies) | 0.2x | 0.4x | 0.3x | 0.5x | 0.1x |
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SunPower Corporation ($SPWR) | - | - | - | - | 8.2x |