New Suntech Rises From Ashes, Eyes UK
Doug Young Suntech. faces final sunset. Opportunities for me to write about former solar pioneer Suntech (OTC: STPFQ) are growing fewer with each passing day, as its life as an independent company nears an end with the imminent finalization of its bankruptcy liquidation. That said, a company announcement saying that a new Suntech has emerged after the yearlong bankruptcy storm seems like a good opportunity to write about this company one last time before it and its stock permanently disappear. The announcement features a photo of Suntech’s youthful looking...
Solar Headwinds, Part II
Tom Konrad, CFA Prospective investors in solar manufacturers should consider the competitive forces that constrain the industry's long-term profitability. In the first part of this series, I showed how a competitive analysis of the corn ethanol industry in early 2007 illuminated the forces that soon caused ethanol company stock prices to collapse in late 2007. I also implied that the solar cell manufacturers, including industry leaders such as Sunpower (SPWRA) and First Solar (FSLR) are vulnerable to these forces and may not be able to maintain high returns on capital over the long term. I'm not...
Bargain Priced Alternative Energy Stocks
A review of Crystal Equity Research’s novel alternative energy indices found a number of companies that have delivered exceptional price appreciation over the last year. Several were reviewed in the recent post “Alternative Returns” on May 8th. Expectations for growth appeared to be driving the price movement, so the last post “Quest for Growth” featured four companies from the indices for which analysts have posted high growth predictions. Not unexpectedly some investors have already bid higher the stocks of those promising companies.
In this post we go back to the lists to find the companies with both high growth predictions and low price-earnings...
One Solar Installation, Five Stocks
Tom Konrad CFA Invest In What You Know "Invest in what you know" is an old stock market adage. The idea is that, if you have some personal knowledge of the real economy, you can use that to make better investments. How useful this adage is depends on how you apply it. If you know more about a stock market sector than other investors because of "what you know," it's possible to make better investments because you may be better at spotting future trends. If, on the other hand, you feel you know a sector...
Tesla and SolarCity: When Acquisition Strategies Run Amok
by Paula Mints When two companies with negative financials and high debt marry a good response to the nuptials is … Huh? When Toto pulls back the curtain in the Wizard of Oz to reveal that the Wizard is just a normal man with no special powers the Wizard says: Pay no attention to the man behind the curtain. In the case of the proposed stock acquisition of SolarCity by Tesla pulling the curtain would reveal two debt ridden companies with cash flow problems. Just the Facts Please The facts are: two companies with...
Recurrent Energy And Sunpower Charging Up
Bottom line: Major new financing for Recurrent Energy and Apple’s growing partnership with SunPower reflect technology advances that are making solar power plants increasingly competitive with traditional sources. Two solar power plant builders are in the headlines today, reflecting a shift that is seeing this new generation of companies take the spotlight from older solar panel makers that are desperately seeking new buyers for their products. The first headline has solar panel maker Canadian Solar (Nasdaq: CSIQ) announcing that its Recurrent Energy plant-building unit has secured financing for a major new US project, as Recurrent gets set for its...
What Shouldn’t Be in a Green Energy Portfolio
The London Accord took a look at what portfolio theory would suggest as the most effective ways to address Climate Change. Knowing which technologies don't make the cut is at least as useful as knowing which technologies do. Tom Konrad, Ph.D., CFA I recently looked at a paper from the London Accord which used portfolio theory to recommend the best mixes of technologies to deliver different levels of carbon abatement. The most useful technologies to achieve the needed levels of carbon abatement were Forestry, Hydropower, Biofuels, Wind, Efficiency, and Geothermal. I suggested stocks that investors might consider to invest in...
Are Solar PV and Wind Incompatible with Nuclear and IGCC?
Paul Denholm, a Senior Analyst at the National Renewable Energy Lab (NREL), sees an upcoming struggle between renewable sources of electricity such as photovoltaics (PV) and wind with low-carbon baseload alternatives for space on the low carbon grid of the future. These baseload alternatives are nuclear and Internal Gasification Combined Cycle coal plants with Carbon Capture and Sequestration (IGCC w/ CCS, refereed to by advocates as "Clean Coal). This may come as a shock to advocates of the idea that Global Warming is such a big problem that we will need all forms of low carbon electricity, because the...
ReneSola Finds Shareholders Hard To Please
Solar project developer ReneSola Ltd. (SOL: NYSE) reported financial results this week for the quarter ending June 2018. Revenue topped $27.8 million in the quarter well below the year ago period when a faster pace of development activity generated $44.8 million in sales. The negative year-over-year comparison was anticipated following the sale of ReneSola’s solar cell manufacturing operations in September 2017. Now the company is making its way with solar project development, engineering services and electricity sales from its owned solar power facilities.
Management had guided for sales in a range of $25 to $30 million in the June 2018 quarter. The good news was that ReneSola...
SolarCity or Vivint Solar?
By Jeff Siegel In as soon as five years, you could be living right next door to a power plant. Actually, even closer. The power plant could be operating from right inside your home. I'm serious. Take a look... This is a backup battery system installed in a home that's powered by domestically generated electrons, courtesy of the biggest nuclear reactor known to humans: the sun. And according to super genius Elon Musk, within five to 10 years, every set of solar panels installed by SolarCity (NASDAQ: SCTY) will come with a battery pack. Nighttime Solar Musk's cousin and...
China Puts The Brakes On New Solar Production Capacity
Doug Young Bottom line: New signals indicate Beijing plans to move aggressively to prevent solar panel makers from adding unneeded new capacity to help their local governments meet economic growth targets. A new low-key announcement from Beijing is hinting at a quiet struggle taking place behind the scenes in China’s promising but embattled solar panel sector, with the regulator saying it will stop the building of most new manufacturing capacity. On one side of this struggle are local government officials, who may be encouraging solar panel makers in their areas to add capacity that will benefit their...
First Solar Jettisons Its O&M Business
by Paula Mints
In August, CdTe manufacturer First Solar (FSLR) sold its North America O&M business to NovaSource Power. According to First Solar CEO Mark Widmar, the decision was due to contracting O&M margins and customer demands for more services. The company is also exploring jettisoning its EPC business. First Solar plans to focus on its module manufacturing business.
Comment: Apparently, First Solar finally realized that O&M is low margin and that the EPC business may also not have much margin cushion. Now the company can concentrate on another low margin sector of the solar manufacturing chain, manufacturing.
First Solar has occasionally...
Five Solar Stocks For 2015
By Jeff Siegel Times sure have changed! In 2006, I attended my first Solar Power International (SPI) conference in D.C. It was a no-frills event but loaded with valuable information I used to help Energy and Capital readers get a jump on the solar bull market that ran from 2006 to 2008. Truth be told, we cleaned up. But nothing lasts forever. And when the market nosedived in 2008, solar stocks were not exempt from the ravenous bears that mauled everything in their path. Of course, as the broader market began to inch back up in 2010, solar...
China’s Solar Panel Makers Set For A Correction
Doug Young After a massive rally over the last year, shares of solar panel makers could be set for a few months of winter following a disappointing earnings announcement from superstar Canadian Solar (Nasdaq: CSIQ) and a debt default from second-tier player Chaori Solar (Shenzhen: 002506). Such a correction was almost inevitable after last year’s huge rally and shouldn’t be cause for concern among long-term buyers of shares in top players like Canadian Solar. But shareholders of second-tier firms like Chaori might think strongly about selling their stock, as these smaller companies could easily end up getting wiped...
SolarCity: Sunburn, or Healthy Glow?
By Harris Roen SolarCity (SCTY) fell 9.1% Wednesday when the company released its first quarter earnings report, but gained all of it back and then Thursday on huge volume. Still, the stock has plummeted 22% in three months, and is down 37% from its highs in February 2014. Is this just a healthy correction from its outsized 400%+ gains from the IPO just 17 months ago? Or have we entered into a new lower trading range more in line with financial realties? This article will analyze current developments to this distinctive energy stock, and project where...
China Trys to Cork EU Solar Tariffs With Wine Probe
Doug Young China is quickly learning how to play the game of tit-for-tat trade wars, with news that Beijing has launched a new anti-dumping probe against wines imported from the European Union. Anyone who has followed recent China-EU trade relations will know, of course, that announcement of this new probe by the Commerce Ministry comes the same day that the EU formally announced anti-dumping tariffs against imported Chinese solar panels. While I certainly don’t condone this kind of trade war rhetoric, I have to say that China’s decision to target Europe’s wine industry looks like a very...
