Solar Shares in the Spotlight Again (ENER, SOL, STP, TAN, SPWRA)

Energy

Published: May 10, 2010 10:39 am

Last Updated: April 28, 2020 5:07 am

Solar is back, partly, or at least the news indicates this on some of the players. Energy Conversion Devices Inc. (NASDAQ:ENER) is a US maker of a flexible, thin-film solar PV panel that hit its peak in July of 2008, and has been sliding ever since. That slide in earnings continued today as the company reported a first-quarter loss of -$0.64 EPS.

Chinese solar maker Renesola Ltd. (NYSE: SOL) also reported earnings this morning and Suntech Power Holdings Co. Ltd. (NYSE: STP), another China-based firm, announced preliminary results which include higher revenues in the first quarter and slightly higher gross margins. Suntech is the third largest holding in the Claymore/MAC Global Solar Energy ETF (NYSE:TAN); and we are seeing an analyst move SunPower Corp. (NASDAQ: SPWRA) marginally.

Energy Convesion Devices shares are trading higher this morning because its quarterly EPS loss was less than the expected -$0.75. Included in the company’s loss was a $358 million non-cash impairment charge. ECD wrote down property, plant, and equipment by $321 million and goodwill and other intangibles by $37 million. After an hour of trading, shares are up 10% at $6.49. The company’s president/CEO said that the impairment charge reflects “changed market conditions,” such as “delayed timing of anticipated revenue and profit from some of the company’s long-lived assets.” At the same time, he believes that the company is “turning the corner and … enhancing our competitive position.”

Renesolar shipped more than 242 megawatts of solar PV products in the quarter, and blew past revenue estimates of $189 million, posting sales of $206.6 million. Earnings per ADS reached $0.14, a nickel better than analysts’ estimates of $0.09. The company generally expects to keep reducing its costs during 2010 and expects demand for polysilicon wafers to be strong.

Suntech echoes Renesolar’s report, projecting revenues in the $580-$590 million range and gross margins of 19%-20%. The company expects a foreign exchange loss of $24-$25 million and a hedging gain of $2-$3 million.

Renesolar shares are up more than 11% and Suntech shares are up more than 9% in early trading today. The Global Solar Energy ETF is also up more than 4%.

Elsewhere in the solar sector, shares of SunPower Corp. (NASDAQ: SPWRA) were raised “unenthusiastically” to Hold from Sell as the stock is now trading below the target of $15 and as the stock is close to 1-times book value of $14.26. Shares are up 4.6% at $15.00 after an hour of trading.

PAUL AUSICK

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