Holiday Cheer from LDK Solar

I must admit, there were times when my conviction was tested as LDK Solar (LDK) management was besieged with Short Selling and Naked Short Selling attacks. When Bill Alpert of Barron’s insinuated this company was based on fraud and that if found complicit they could face bankruptcy, it sent the stock tumbling.

When Carolyn Cui released an article for the Wall Street Journal bashing LDK twice, both times accompanied by a suspicious volume of short selling, the stock plummeted. Goldman Sachs helped the fall when they initiated coverage with a sell and a $35 dollar target. Piper Jaffray was quick to downgrade the stock and issue lower targets – despite issuing higher earnings estimates at the same time. Lazard Capital markets came out of nowhere to issue a sell rating and doomsday predictions.

One of my favorites was the flip-flop of Jim Cramer, on Madd Money, as he changed position and called LDK a sell, sell, sell at $29 dollars. Cheers to you all! Prime contrarian indicators all.

And to all the traders and investors who had the nerves to believe in your own due diligence and buck the trend, Merry Christmas from LDK!

Disclosure: Author has long position in LDK.

LDK 6-mo chart:

Comments

[User 131257:]

Crooks! All of them. Their actions are prime examples of the corruption on Wallstreet. I love the part about downgrading the stock, and at the same time raising earnings estimates. Could it get anymore blatant? It's a shame these crooks swindled all those unsuspecting investors. Shamefull!

2007 Dec 18 08:58 AM

[lumberjohn:]

I agree with the author. I too doubted my convictions a time or two but held firm. I bought more shares of LDK twice on it's way down, increasing my stake 5 fold, and have been richly rewarded. Kudos to those who stuck to their guns and kudos to LDK's mangement for handling the blatantly false accusations promptly and with top notch firms to lay these allegations to rest. Now on to third quarter numbers and let LDK soar.

2007 Dec 18 10:56 AM

[kkin365:]

We have read stories about media coverage of LDK for some time now. Is SEC or other regulatory agenices looking into this matter? Jim Cramer is a China-basher and really does not know how his posture should be with respect to China. kkin365

2007 Dec 18 11:09 AM

[alpha24seven:]

How do you get your "pieces" printed? I've seen better articles written when I was in my sixth grade journalism class...

You always allude to all the nefarious and evil doings by Wall St. which clearly shows to all you have no idea how the financial system works.

Simply terrible.

2007 Dec 18 02:15 PM

[trantor:]

I have a small IRA. I read heavily on LDK, thought it was a chance to buy in early, when it dropped to 1/2 price. I also believed LDK would have its ultimate vindication. I went "all in", and held on through the drought. (wishing I had more to buy when it dropped below $30.) Not a way to invest, but as a result, my modest IRA has doubled in size in two weeks. Thanks to everyone who tried to inform us about LDK. Solar is behaving like another tulip industry, but I am happy to ride it up a little longer.

2007 Dec 18 04:25 PM

[SDBryan:]

I've already locked in profits of almost 80%, so that feels good. It is a relatively small position of my overall portfolio, since I considered it speculation and that the position could easily go either way. Glad I held on. =)

2007 Dec 19 01:02 AM

[bigswing:]

Hopefully you will not get out of LDK too early this time... LDK is a real fast growth company... Once it is 15000mt polysilicon project finished in 2009, it will be one of the top 3 solar companies in the world and the largest in China...

2007 Dec 19 10:43 AM

[sheikh:]

so why is ldk tanking again today? i have been holding. the fundamentals published by the company seem sound but goldman sachs and piper jaffray seem hell bent on destroying this stock. why?

2007 Dec 20 11:01 AM

[solarfan:]

What a difference a day makes! Too bad LDK fan listened to you instead of all those evil doers and is losing his shirt in his IRA. I'm glad I listened to the evil doers and stayed away. There are plenty of better solar names than this one. Cramer's not such an idiot when he preaches best of breed.

Oh, and I whole heartedly concur with alpha24seven above.

2007 Dec 21 02:12 AM

[solarfan:]

What a difference a day makes! Too bad LDK fan listened to you instead of all those evil doers and is losing his shirt in his IRA. I'm glad I listened to the evil doers and stayed away. There are plenty of better solar names than this one. Cramer's not such an idiot when he preaches best of breed.

Oh, and I whole heartedly concur with alpha24seven above.

2007 Dec 21 02:12 AM