Is there a cornucopia of returns in SunPower Corporation (SPWR) And Sportsman’s Warehouse Holdings Inc. (SPWH)

SunPower Corporation (NASDAQ: SPWR) shares are 74.62% up in the year-to-date (YTD) period and have moved 2.60% or $0.35 higher in the latest trading session. However, stock’s trailing 12-month performance remains nearly +237.97% lower. Comparatively, the stock is -5.74% down YTD and 94.02% over the trailing 3-month period. If we look at the shorter duration, its week performance is 14.36% and 39.12% over the month.

Analyst Recommendations

On February 04, 2020, ROTH Capital recommended the SPWR stock is a Neutral, while earlier, Cowen had Downgrade the stock as a Market Perform on February 13, 2020. 11 analysts offering the recommendations for the stock have a consensus rating of 3.20 to suggest that the SPWR stock is a “Hold. 2 of the 11 analysts rate the stock as a “Sell”, while 1 has rated it as “Underweight”. 2 recommend buying, with 0 rating it as an Overweight.

The stock currently trades at $13.62 and analysts tracking its performance over the next 12 months have a consensus estimate price target of $8.61. The forecasts give the SunPower Corporation stock a price target range of $13.00 on the higher side while at least one analyst think the stock could plunge to a low of $5.00. The two limits represent an downside potential of -4.77% or -172.4%.

Earnings Forecast

Analysts estimate the earnings to increase 43.60% in the current quarter to -$0.29, down from the $0.07 reported in the same quarter a year ago. For the current year, earnings should grow to an average of -$0.68, down -7.70% from -$0.29 reported last year. Analysts also offered guidance for the next financial quarter, with their average projected EPS at between -$0.2 and $0.17. Wall Street estimates earnings per share to be at an average of -$0.03 for the next year.

Insider Transactions Summary

According to SEC data, total insider shares purchases at the company stands at 99 over the last 12 months, while SEC filings reveal that there have been 64 insider sales over the same period. Insiders have purchases 9,740,318 shares while those sold by company executives and officers stand at 3,262,677. The last 3 months have seen insiders trade a total of 25,796 and 100,177 in purchases and sales respectively.

WERNER THOMAS H, a Pres and CEO at the company, sold 80,000 shares worth $0.98 million at $12.23 per share on Aug 10. The Principal Accounting Officer had earlier sold another 10,000 SPWR shares valued at $0.12 million on Aug 12. The shares were sold at $12.29 per share. MAHAFFEY KENNETH LAWRENCE (EVP & General Counsel) sold 39,517 shares at $9.08 per share on Mar 06 for a total of $0.36 million while Richards Douglas J., (EVP, Administration) sold 12,928 shares on Mar 04 for $0.12 million with each share fetching $9.09.

Sportsman’s Warehouse Holdings Inc. (NASDAQ:SPWH), on the other hand, is trading around $17.06 with a market cap of $726.37M and analyst research firms have a positive stance on its shares. Analysts predict that the stock will reach $15.70 and spell out a less modest performance – a -8.66% return. Some analysts are even forecasting $0.88 per share in earnings this year on a short term (1 year) basis.

Let us briefly look at the Sportsman’s Warehouse Holdings Inc. (SPWH) financials, with a focus on its operating details as indicated in its earnings report for the last quarter.

Company balance sheet and cash flow

SPWH’s operating margin was positive on the trailing 12 months basis, remaining steady at 4.00%, while the operating expenses over the recent quarter were at $75.28 million. This represented a 69.5% of the company’s total revenues which amounted $246.84 million. With this in place, we can see that the company’s diluted EPS declined -$0.03 on the year-over-year period, shrinking to -$0.13 as given in the last earnings report.

In terms of the balance sheet & cash flow as of (Jul 2020), the total assets figure advanced to $662.33 million from $616.64 million over the previous quarter. The cash flow from operating activities totaled $31.28 million, significantly higher than the $3.44 million reported in the year-ago quarter. The company’s free cash flow for the quarter was $26.45 million.

Insider activity

Insiders have transacted a total of 13 times at Sportsman’s Warehouse Holdings Inc. over the last 6 months, with insider purchases undertaken 9 times and accounting for 162,145 shares. Insider sales totaled 57,434 shares over the same period, with these deals completed in 4 transactions. Looking at these numbers, we realize that net purchases over that period are 5.0 shares. Insiders now hold a total of 1.71M shares after the latest sales, with 7.10% net shares purchased.

Major holders

Insiders own 2.00% of the company shares with a share float percentage of 42.09M. Investors are also buoyed by the number of investors in a company, with Sportsman’s Warehouse Holdings Inc. having a total of 186 institutions that hold shares in the company. The top two institutional holders are Price (T.Rowe) Associates Inc with over 6.05 million shares worth more than $86.2 million. As of Jun 29, 2020, Price (T.Rowe) Associates Inc held 13.92% of shares outstanding.

The other major institutional holder is Blackrock Inc., with the investment firm holding over 2.94 million shares as of Jun 29, 2020. The firm’s total holdings are worth over $41.9 million and represent 6.77% of shares outstanding.