SunPower Corporation (NASDAQ:SPWR) shares have declined more than 23% in the last three months. However, the company is quite upbeat about its long-term growth opportunities. At its analyst day event, the solar systems manufacturer issued lower-than-expected guidance for FY2015. The company guided 2015 EPS between $1.10 and $1.50 on revenue between $2.4 billion and $2.6 billion. That was lower than the consensus estimate of $1.67 in earnings per share and $2.8 billion in revenue.

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SunPower’s 2015 guidance not as bad as some believe

However, JPMorgan analysts Paul Coster and Mark Strouse said in a research note that the company’s guidance was below expectations because of its decision to hold back more MWs for its new HoldCo/YieldCo structure. SunPower’s guidance assumes that 300-400MW is added to its HoldCo, bringing down the EPS estimate by 20-25 cents. Excluding this, the guidance was in-line with the Street expectations. JPMorgan upped its price target from $39 to $40, and reiterated its Overweight rating on the stock.

SunPower YieldCo

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The San Jose-based company is targeting 25% annual EBITDA growth rate, reaching $900 million by FY2019. SunPower told analysts that EBITDA growth will be driven primarily by distributed generation. Distributed generation (DG) is entering a mass adoption phase. SunPower is expected to reach one million cumulative customers in 2018.

Distributed generation

SunPower expects its distributed generation revenue to grow from about $1.25 billion in FY2015 to $2.75 billion by FY2019. It forecasts residential DG to grow at 50% and commercial DG at an impressive 57%. What’s more, the company expects MW deployment to almost double from 700MW in 2015 to 1350MW in 2019. The company expects solar costs to decline 30% and customer acquisition costs to come down by 20%-50%. Integration of SolarBridge’s microinverters should help reduce costs.

SunPower to triple its capacity

SunPower plans to triple its capacity by 2019. Fab 4 will start producing silicon next year and Fab 5 is expected to start production in the second-half of 2017. They will add 800MW capacity with an exceptional cell efficiency of 25%. The company will also be adding new LCPV capacity in 2015-16 to meet the demand in China. The company has over 10GW of power plants in the pipeline, which includes about 325 projects in 25 countries.

SunPower Triple

SunPower shares inched up 0.35% to $28.43 at 10:32 AM EST on Wednesday.

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