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Chinese Companies Like Suntech, Yingli And Trina Solar Hold A Dominant Position In The U.S. Solar Market

|Includes:FSLR, JASO, LDK, SOL, STP, Trina Solar Limited (TSL), YGE

VALUATION HIGHLIGHTS

  1. Germany Photovoltaic Modules constitute 43% of the Trefis price estimate for Yingli Green Energy's stock.
  2. Rest of World Modules and PV Systems constitute 38% of the Trefis price estimate for Yingli Green Energy's stock.
  3. U.S. Photovoltaic Modules constitute 12% of the Trefis price estimate for Yingli Green Energy's stock.
POTENTIAL UPSIDE & DOWNSIDE TO TREFIS PRICE

Below are key drivers of Yingli Green Energy's value that present opportunities for upside or downside to the current Trefis price estimate for the company:

Rest of the World Photovoltaic modules
  • Rest of World PV Module Gross Margins: Yingli Green Energy leverages its manufacturing operations in China and its vertically integrated structure to produce low cost PV modules. Yingli's Rest of World PV Module Gross Margins were increased from 2008 through 2010 as the drop in manufacturing costs and the cost of raw materials was sharper than the drop in module prices. Margins stood at 23.3% in 2008 and nearly 24% in 2009, and then rose sharply in 2010 as volumes rose, enabling the company to exploit economies of scale. Because of a pull back in solar subsidies in Europe, module prices saw a drastic fall in 2011 hitting margins across the supply chain. The oversupply situation is expected to continue over the next few years, and as such we expect margins to decline to about 13% by the end of our forecast period. In a downside scenario, if Yingli is unable to keep cutting down its absolute cost per watt, and its Rest of World PV Module Gross Margins decline to 11% it could mean a downside of about 15% to the Trefis price estimate.
  • Price per Watt of PV Modules Sold: Yingli's average price per watt fell from $3.88 /watt in 2008 to $1.75 /watt in 2010, and is expected to continue to fall to around $0.80 by the end of the Trefis forecast period. However, if prices fall at a slower rate than estimated and reach $0.90 / watt by the end of the period, the Trefis price estimate would see an upside of nearly 10%.

For additional details, select a driver above or select a division from the interactive Trefis split for Yingli Green Energy at the top of the page.

BUSINESS SUMMARY

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Trefis Team
2 days ago
FEATURED

Featured |Edit Post |Delete |postId

Chinese companies like Suntech, Yingli and Trina Solar hold a dominant position in the U.S. solar market.

Energy From-the-Sun-By-Way-of-China-articleInline

Clipped from nytimes.com using the Trefis clipping tool:
[i]The Commerce Department said on Tuesday that it would impose tariffs on solar panels imported from China after concluding that the Chinese government provided illegal export subsidies to manufacturers there.

The tariffs were smaller, at 2.9 to 4.73 [/i] ... Read more

Stocks: TSL, LDK, STP, JASO, SOL, FSLR, YGE