North Coast Solar Stocks

August 13, 2009

Solar shares tumble on 2nd-quarter results, analysts warn of near-term sector weakness

Filed under: JASO, LDK, STP, TSL, YGE — Tags: , , , , — Jason @ 2:24 pm

Thursday August 13, 2009, 2:24 pm EDT

NEW YORK (AP) — Shares of solar stocks tumbled Thursday on troubled second-quarter results, as analysts warned of a dismal near-term outlook.

After the closing bell on Wednesday, LDK Solar Co. Ltd. (LDK) reported a second-quarter loss as it wrote down the plummeting value of its inventory, missing analyst expectations. Shares of the company plunged $2.09, or 18.6 percent, to $9.12 in afternoon trading.

JA Solar Holdings (JASO) on Wednesday posted a wider second-quarter loss on sharply lower revenue, stock-related expenses and buying back bonds. JA Solar shares fell 35 cents, or 7.6 percent.

Credit Suisse analyst Satya Kumar said JA Solar, along with other solar companies, has little visibility beyond November. Kumar estimates that fourth-quarter shipments will tumble up to 15 percent quarter over quarter. Kumar rates the company “Neutral” and raised its price target to $4 from $3.

Barclays Capital analyst Vishal Shah said there are few near-term catalysts to boost the sector. That, combined with weak seasonality and the sector trading near fair value, will likely weaken solar stocks. Shah downgraded the sector to “Neutral” from “Positive.”

Shah predicted greater-than-expected pricing declines through the first quarter of 2010 and said industry oversupply could extend into the second half of next year.

Elsewhere, shares of Suntech Power Holdings Co. Ltd. (STP) fell $1.28, or 7 percent, to $17.05. Trina Solar Ltd. (TSL) shares dropped $2.65, or 8.9 percent, to $27.16. Shares of Yingli Green Energy Holding Co. (YGE) slid $1.20, or 8.9 percent, to $12.26.

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