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5 Hot Tech Stocks You Should Be Watching Ahead Of Earnings

Loading the player… Quarterly earnings reports almost always impact a company’s stock, whether good or bad. Here’s a look at five hot tech names with earnings due for you to keep an eye on: Fibit ( FIT ), NetEase ( NTES ), WebMD ( WBMD ), First Solar ( FSLR ) and Salesforce ( CRM ). Fitbit reports after the close on Monday. Analysts expect the bottom line to climb 32%, a healthy rise but still a second quarter of decelerating growth. Revenue is projected to pop 75%. Fitbit competes against the Apple ( AAPL ) Watch, and both were named hot gift items during the holiday quarter. Fitbit shares are trading below their IPO price of 20, and are trying to make their way off of their all-time low reached last week. The stock is trading nearly 70% below its all-time high reached last August. NetEase is projected to grow earnings by 52% in local currency when it reports after the close on Wednesday. Revenue is estimated to jump 121%. The stock was able to retake its 200-day line earlier this week. It’s trading about 17% below a potential buy point. NetEase is a member of the IBD 50 list of leading stocks, and so is WebMD. The health care information site is expected to see earnings jump 58% and sales rise 17% when it reports after the close on Tuesday. Both mark an acceleration of growth from last quarter. WebMD is currently trading about 8% below its intraday peak reached in mid-January. First Solar is not on the IBD 50 list, but it earns an IBD Composite Rating of 97 out of 99. The company reports its results after the close on Tuesday as well. Earnings are expected to fall 59% on an 8% dip in sales. The stock is working on a consolidation base and is currently trading about 13% below the pivot. And software giant Salesforce reports after the close on Wednesday. Earnings are expected to jump 36%, while revenue rises 24%. Shares have risen seven out of the last eight sessions as they work their way higher from about a 16-month low. Salesforce is about 25% below its November high.

SunPower CEO Attributes 8point3 ‘Drop Downs’ To Q1 Sales Miss

Wall Street bandied SunPower ( SPWR ) stock Thursday after the No. 2 solar company reported forecast-topping Q4 sales and earnings but issued Q1 sales guidance that halved analyst views, which CEO Tom Werner said stemmed from project “drop downs” to yield company 8point3 Energy Partners ( CAFD ). There was a 12% disparity Thursday between the high and low points of SunPower stock. Shares were up as much as 4.7% earlier, but in afternoon trading on the stock market today , SunPower stock was down 4%, near 23. Analysts were forgiving. Credit Suisse analyst Patrick Jobin says that SunPower is “bucking the trend” of solar demand challenges and investor fears of a capital squeeze. Solar is a capital-intense industry, and limited access to capital can strangle growth. “SunPower is bucking the trend and remains in a healthy position with a clean balance sheet and an execution track record that is enabling growth,” Jobin wrote in a research report. He retained his outperform rating and 32 price target on SunPower stock. EBITDA Shift Buoys Q4 For Q4, SunPower reported $1.36 billion in sales ex items and $1.73 earnings per share minus items, up 124% and 563%, respectively, vs. the year-earlier quarter. Both metrics topped the consensus view for $1.27 billion and $1.52. Earnings before interest, taxes, depreciation and amortization (EBITDA) surged 347% to $379.9 million. CFO Charles Boynton, on the company’s earnings conference call Wednesday, pointed to a $65 million shift in EBITDA after projects expected to be completed in the current quarter actually wrapped up in Q4. SunPower finished 2015 with $556.5 million EBITDA, up 49%. Sales minus items and EPS ex items came in at $2.6 billion and $2.17, flat and up 63%, respectively, and beating consensus expectations. The EBITDA shift impacted Q1 and 2016 guidance, Boynton said. SunPower lowered 2016 EBITDA guidance by that $65 million, to $450 million-$500 million, and sees $0-$25 million in Q1. For the year, SunPower expects $3.2 billion-$3.4 billion in sales minus items, where analysts had modeled for $3.42 billion. Yieldco Drops Impact Q1 Guide But the Q1 sales-minus-items view for $290 million-$340 million was far short of Wall Street views for $675.7 million. CEO Werner attributed the guidance miss to the timing of project drop-downs to 8point3. SunPower and First Solar ( FSLR ) teamed up to form the yield company last year, a company formed to own assets that produce predictable cash flows. Yieldcos are gaining headway in the solar industry. “We’re building projects in Q1 that we won’t sell to 8point3 until Q3, so we don’t get the revenue and the income until Q3,” Werner told IBD on Thursday. “It’s the timing of the ‘drop down’ of projects to Q3.” Investors are warming to the yieldco idea, Werner says. 8point3 made its IPO in June, pricing shares at 21. It now trades near 16%, up 3% Thursday afternoon. “Think of it (the yieldco) as strategic and the core of what we do,” Werner said. During Q4, SunPower dropped down its first project to 8point3 — a 20-megawatt project for California’s Kern County School District consisting of 27 carports at various locations across the district, according to a SunPower press release. And the 135-MW Quinto solar project in central California is now also generating energy for 8point3. Power Plants To Fuel Growth In 2016, Werner expects 60% of sales to stem from SunPower’s utility business. In Q4, power plants comprised 77% of SunPower’s sales. Residential and commercial accounted for 13% and 10%, respectively. SunPower’s vertical overlap and geographic expansion will help growth, Werner told IBD. On the call, he emphasized SunPower’s investment in China and the U.S. China and the U.S. are at opposing ends of the solar spectrum. China, Chile and South Africa have heavy investments in utility-scale solar. The U.S., Japan and Europe are more focused on rooftop solar. In the U.S., extension of a key subsidy, the Investment Tax Credit on solar, will help the rooftop business boom in 2016, Werner says. And companies like Apple ( AAPL ) and Stanford University have created their own hybrid — an offsite utility with a direct access line, Werner said. He also sees growth stemming from SunPower’s Helix platform, which aims to cut installation time. Werner likened it to a solar system for a modular home; the cables are precut, and a roofing company merely snaps them together. “You don’t need all the trade labor,” he said. “You can have a roofing company install a system and then just a little electrician time. It’s five to 10 times faster.” SunPower continues to partner with Tesla ( TSLA ), Sunverge and Stem for solar storage solutions. Two homebuilders in California and Germany are offering it as a standard option, Werner said.  

SunPower Blasts Q4 Views; But Q1, 2016 Outlooks Lag Wall Street

No. 2 solar installer SunPower ( SPWR ) smashed Wall Street’s Q4 expectations late Wednesday but guided to Q1 sales that halved analyst views. SunPower stock seesawed in after-hours trading, trending up a fraction, having risen 2.2% in Wednesday’s regular session. Shares closed 2015 up 16% for the year, topping IBD’s 23-company Energy-Solar industry group, which ended the year up 1%. For Q4 ended Jan. 3, SunPower reported $1.36 billion in sales ex items and $1.73 earnings per share minus items, up 124% and 563%, respectively, vs. the year-earlier quarter. The company pulled in $900 million alone after completing its 135-megawatt Quinto commercial project in Merced County, Calif., CFO Chuck Boynton told analysts during the late Wednesday conference call. Power plants accounted for 77% of Q4 sales. Both sales and EPS ex items topped the consensus model of 16 analysts polled by Thomson Reuters for $1.27 billion and $1.52. Three months ago, SunPower guided to $1.25 billion-$1.3 billion in sales. During Q4, SunPower deployed 280 MW, down 10% vs. the year-earlier quarter but in line with its guidance for 275 MW to 305 MW. Among those deployments, SunPower counts a 100-MW project for Nevada’s NV Energy and a 36-MW project for Mexican airport Aeropuertos Del Sureste. And China remains a solar bright spot, SunPower CEO Tom Werner said on the call. Regulations and subsidies have helped China lead the world in terms of solar installations. “Demand in China remains robust,” he said. “We are committed to the Chinese market as a long-term driver of growth.” Q1 Sales Ex Items Guided To Fall 27% SunPower wrapped up the year with $2.6 billion in sales ex items and $2.17 EPS minus items, flat and up 63%, respectively, vs. 2014. That beat respective consensus views for $2.53 billion and $1.97. In November, SunPower guided to $2.5 billion to $2.55 billion in sales ex items. SunPower doesn’t give EPS guidance. The company deployed 1.15 gigawatts in 2015, touching the bottom line of its guidance for 1.15 GW to 1.18 GW. Current-quarter and 2016 views lagged the consensus. For Q1, SunPower guided to $290 million to $340 million in sales ex items, which would be down 27% at the midpoint. Wall Street expected $675.7 million in sales ex items and 33 cents EPS minus items. SunPower expects to deploy 315 MW to 340 MW in Q1, up from 266 MW in the year-earlier quarter. For the year, SunPower guided to $3.2 billion to $3.4 billion in sales minus items, missing the consensus model for $3.42 billion. Analysts expect $1.60 EPS ex items. Guidance for 1.7 GW to 2 GW deployed in 2016 would narrowly top the 2015 metric. Werner credited cost reductions, scaling and innovations, and regulatory support for “a landmark year” for the solar market in 2015. In late December, Congress voted in a five-year extension to the Investment Tax Credit on solar energy. The ITC was originally set to expire Dec. 31, 2016, prompting a 2017 “cliff” in installations. Also in 2015, Obama unveiled his Clean Power Plan with the goal of reducing carbon emissions by power plants, and 196 countries pledged to cut carbon emissions during a Paris climate summit. To capture share, SunPower is planning to heighten investments in the U.S., where solar is expected to account for only 3% of total power generation by 2020, Werner said. “We expect the five-year (ITC) extension should drive acceleration through 2020,” he said. “The scale of demand in the U.S. is huge, and we are planning to increase our spending here in the near term.” Canadian Solar Tops Views First Solar ( FSLR ) leads SunPower as the No. 1 solar company, with a $6.4 billion market cap to SunPower’s $3.2 billion. Together, the two formed yield company 8point3 Energy Partners ( CAFD ) last August. Canadian Solar ‘s ( CSIQ ) late Tuesday preannounced some results, posting Q4 sales and total solar module shipments that busted Wall Street expectations, FBR analyst Carter Driscoll wrote in a research report. Canadian Solar expects to report $1.02 billion to $1.07 billion in Q4 sales vs. analyst forecasts for $930 million to $980 million, Driscoll wrote. The company also upped its Q4 shipments guide to 1.35 GW to 1.4 GW, up 4% at the midpoint vs. earlier views. For 2016, Canadian Solar sees total shipments hitting 4.63 GW to 4.68 GW vs. prior expectations for 4.15 GW to 4.2 GW, and $3.35 billion to $3.4 billion in sales. Earlier views were for $3.28 billion to $3.33 billion. Canadian Solar stock jumped 18% Tuesday on that news, but they fell a fraction Wednesday.