SunPower Snaps Up Blue Raven Solar for $165M

Solar technology and energy services provider SunPower Corp. (SPWR) revealed that it has acquired Blue Raven Solar, one of the fastest-growing residential solar providers in the U.S., in a cash deal valued at $165 million. Shares of the company closed 1.8% lower on Tuesday.

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Through this acquisition, SunPower targets to expand the solar market to serve underpenetrated areas, including the Northwest and Mid-Atlantic regions. In this endeavor, Blue Raven’s geographic footprint is expected to complement the company’s plan.

As per the terms of the deal, Blue Raven CEO Ben Peterson will join SunPower’s executive team. Additionally, SunPower has planned to integrate its products and digital marketing tools with Blue Raven’s direct sales model to enhance the go-to-market strategy and capabilities to its national dealer network, the company said.

Markedly, Blue Raven’s volume is likely to expand SunPower’s financial products and significantly boost loan volume in 2022.

Sharing his thoughts, SunPower CEO Peter Faricy said, “More than 100 million homeowners could save money by switching to solar today, and we are committed to enabling that transition quickly to benefit both customers and the planet.”

Faricy added, “This acquisition will enable us to bring the most powerful and efficient solar technology available to a new set of homeowners and accelerate our growth strategy.” (See SunPower stock charts on TipRanks)

Notably, SunPower also plans to focus on growing its Residential and Light Commercial business. Faricy said, “By investing in residential market expansion and technology innovation, we can put solar on more homes and provide customers with an incredible experience when they choose renewable energy.”

Last month, Evercore ISI analyst Sean Morgan initiated coverage of the stock with a Buy rating and a price target of $27 (19.1% upside potential).

Morgan said, “SunPower has a lower multiple than most of its peers, but it is levered to the same long-term secular tailwinds.”

The analyst added, “Our base case assumes that SunPower, having undergone several years of structural change in divesting solar equipment manufacturing and effectively exiting the utility scale solar project development market, will begin to accelerate its growth in the retail residential market, and achieve increased profitability.”

Overall, the stock has a Hold consensus rating based on 2 Buys, 2 Holds and 3 Sells. The average SunPower price target of $25.71 implies 13.4% upside potential to current levels. Shares have increased around 45% over the past year.

Investors should always be aware of the risks involved in any stock. According to the new TipRanks’ Risk Factors tool, SPWR is at risk mainly due to three factors: Finance and Corporate, Legal and Regulatory, and Production, which contribute 41%, 17%, and 17%, respectively, to the total 66 risks identified. Under the Finance and Corporate risk category, the stock has 27 risks, details of which can be found on the TipRanks website.