SunPower (SPWR) stock is on a roll. After a weak start to the week, for the three straight days, shares of the residential solar power specialist have run higher. Including Friday's gain (up 9.1% through 11:30 a.m. ET), SunPower stock is now up a lucky 13% for the week.

Credit for the stock's strong finishing performance probably goes to the Solar Energy Industries Association (SEIA) and a report it published midday Thursday.

What SEIA says about solar

According to SEIA's report, the first quarter of 2024 was the second-best quarter ever for the solar power industry in America, with 11.8 gigawatts of direct current solar power added to the grid. What's more the quarter was second to Q4 2023 -- the preceding quarter, meaning solar power companies just booked their two best quarters ever!

That's the good news. Now here's the bad news for SunPower stock: 9.8 of those 11.8 gigawatts installed in Q1 2024 were utility-scale solar power projects, a segment of the solar market that SunPower no longer serves. Instead, SunPower focuses on installing residential solar panels on homes.

And according to SEIA, that segment of the solar market fell off a cliff in Q1, down 25% year over year.

Is SolarPower stock a sell?

SEIA blames the falloff in demand on California's decision to compensate homeowners for the solar power they contribute to the grid at lower rates than they pay for electricity bought from the grid, a concept known as net billing. Pulling no punches, SEIA explained: "The promise of future market growth in California withered away with [this] decision."

Whatever the reason, it's left SunPower in an unenviable position. After earning strong profits early in the pandemic, the residential solar company has flipped to losses -- $247 million lost last year, with more than $200 million in negative free cash flow. Analysts do expect the company to turn profitable again, eventually. But first, SunPower is expected to lose money both this year and next year, too.

I'd be in no rush to buy this stock, especially after today's run-up.