Welcome to Extreme Investor Network, your ultimate resource for all things finance. Today, we are diving into the latest frenzy surrounding heavily shorted SunPower Corp. shares, which more than doubled at one point on Tuesday, setting them on track for a record gain.
SunPower, a solar power company that specializes in residential systems, saw its stock climb as much as 105% in one day, reaching a high of $5.63. This surge in stock value added over $400 million in market capitalization to the California-based company this week. The increase in SunPower’s stock price is attributed to meme-stock traders, who are once again targeting stocks like GameStop Corp. and AMC Entertainment Holdings Inc.
As the meme-stock traders pushed up SunPower’s stock price, short sellers also increased their bets against the company. Short interest in SunPower climbed to nearly 96% on Tuesday, making it a prime target for a classic short squeeze. Graham Price, a clean-technology analyst at Raymond James, explained that SunPower has high short interest and a low float due to the majority of its shares being owned by TotalEnergies SE.
In addition to SunPower, other US-based solar-equipment stocks experienced a rally. Companies like Maxeon Solar Technologies, Sunnova Energy International, and Sunrun Inc. saw significant increases in their stock prices. The Biden administration’s decision to increase tariffs on Chinese imports, including solar cells, also played a role in the stock market movement.
Despite the rally in SunPower’s shares, the company has faced challenges in the rooftop solar business, resulting in a loss for the year 2024. These challenges led to a reduction in the company’s workforce, closure of residential installation locations, and restating financial results.
The entire rooftop solar industry has been struggling as well, with rising interest rates making it more costly for individuals to install solar panels. Furthermore, California, the largest solar market, slashed payments to homes and businesses selling excess solar power back to the grid, causing further strain on the industry.
At Extreme Investor Network, we are committed to providing you with valuable insights and analysis on the latest trends in finance. Stay tuned for more updates and expert advice on how to navigate the ever-changing financial landscape.