Timminco Stock Keeps Rising

Investors can't seem to get enough of solar-grade silicon maker Timminco Ltd. (TIMNF.PK). The stock hit another all-time high after jumping 17% to C$27.89 in early trading Thursday, before paring back to around C$26.46 approaching 2:30 p.m. ET, up C$2.66.

In a note on the global solar industry, UBS analyst Stephen Chin mentioned Timminco as one of a few successful new entrants in the polysilicon industry. In particular he noted Timminco's recent agreement to supply Q-Cells with low-cost metallurgical polysilicon. Q-Cells AG, the world's largest manufacturer of solar cells, is one of Mr. Chin's global top picks.

The analyst predicts global solar demand will grow 56% in 2008 to 4.9 gigawatts and believes the solar industry profits will grow significantly in 2009.

Because of the pricing pressure from the end customer side, we expect declining profit margins for the downstream part of the value chain (ie, cell, module makers, distributors), but the upstream companies (ie, polysilicon and ingot producers) should enjoy an ongoing favourable margin trend.

Comments

[VirtualOptics]

The cost of handling wafers will eventually be prohibitive even with low wage countries to the construction of collectors. So much of the silicon is non-productive supplying support to the cell, but not energy which is only produced at the surface. Therefore, I see the future in coated collectors on plastic or glass. The development of nanoparticle silicon by Octillion (OCTL) and equipment to coat and assemble sheets by Applied Materials (AMAT) has more potential for the preferred systems.