Shares of LDK Solar Co. Inc. (NYSE: LDK) are getting hit again today following the company’s announcement that a member of its board of directors who was also the head of its audit committee has resigned. A temporary replacement has been named as chairman of the audit committee until a newly appointed independent director takes charge.

It is difficult to keep track of the contagion spreading among the Chinese solar PV makers, all pointing back to auditing issues. JA Solar Holdings Co., Ltd. (NASDAQ: JASO) replaced its CFO last week. Trina Solar Ltd. (NYSE: TSL) also had an independent director and head of its audit committee resign on July 10th. In that case, the director had recently resigned as the CFO of a Chinese battery maker, A-Power Energy Generation Systems, Ltd. (NASDAQ: APWR) following the resignation of A-Power’s outside auditing firm.

Other bad news, like a downward revision on revenues such as the one about a week ago delivered by ReneSola Ltd. (NYSE: SOL), adds more fuel to a flaming pyre. Apparently well-run solar makers are also getting punished. Suntech Power Holdings Co. Ltd. (NYSE: STP), Yingli Green Energy Holding Co. Ltd. (NYSE: YGE), and JinkoSolar Holding Co. Ltd. (NYSE: JKS) get burned as well. US-based First Solar Inc. (NASDAQ: FSLR) and SunPower Corp. (NASDAQ: SPWRA) are getting caught as well.

The operative word in that last sentence is “apparently,” because every new revelation of suspected hanky-panky in a company’s accounting shakes investors’ faith in the solar makers that have so far escaped the flames. Coupled with low expectations for shipments and revenues for the rest of this year and into next, solar stocks are withering.

LDK’s announcement has sent the company’s shares down nearly -6.5%, before they recovered a bit to around -6% at noon, trading at $6.13, barely within the 52-week range of $5.73-$15.10.

JA Solar’s shares are down more than -3%, to $4.45 after having come within two pennies of the bottom of the stock’s 52-week range, $4.34-$10.24.

Trina’s shares are down nearly -5%, to $17.54, within a 52-week range of $16.60-$31.89. Yingli shares are down more than -4.25%, at $6.89, after falling to a new 52-week low giving the shares a 52-week range of $6.77-$14.29.

Suntech shares are off about -1.3%, at $7.25, in a 52-week range of $7.05-$11.18. Shares in JinkoSolar are off less than -0.1%, at $23.93, in a 52-week range of $12.41-$41.75.

It is worth mentioning that so far none of the Chinese solar makers has restated revenues or earnings. But it’s very likely that most observers think that will be the next thing to happen. What was already a shaky summer for the solar stocks is turning into a nightmare.

Paul Ausick

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