Solar stocks drop; China reportedly thinking of cutting targets


OTR Global reports the Chinese government is thinking of cutting its 2014 solar installation targets due to credit availability issues.

The government previously set a 2014 installation target of 14GW (8GW distributed systems, 6GW utility). Deutsche has already expressed doubts about its feasibility following a soft Q1.

U.S. and Japanese shipments have been faring better, but new DoC tariffs could take a toll on near-term Chinese sales to the former market.

Solar stocks are lower amid a market selloff: YGE -5.3%. CSIQ -4.7%. SCTY -3.5%. FSLR -3.5%. SPWR -3.2%. JKS -4.6%. HSOL -4.4%. SOL -3.5%. DQ -3.4%. CSUN -5%. TSL -2.7%. ENPH -3%.

Solar ETFs: KWT, TAN

Update: OTR's note comes amid a report the Chinese government plans to hike its subsidies for power sales stemming from rooftop solar projects by up to 55%, putting their revenue (on a per-kWh basis) on par with ground-mounted projects.

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Comments (25)
  • Eystein Magnus Hansen
    , contributor
    Comments (376) | Send Message
     
    Instead of a news based on a twitter tweet from god knows who how about some actual industry news:
    http://bit.ly/1jbeuK6?

     

    "Beijing plans to increase the subsidy on power sales by rooftop solar farm developers to state-owned power distributors by up to 55 per cent, and compel the latter to act as an agent for collecting power bills if the developers directly sell to local customers.

     

    The consensus plan was reached after a meeting two weeks ago among state-backed financial institutions, bank regulators and the National Energy Administration (NEA)."
    8 Jul 2014, 10:11 AM Reply Like
  • Michael Bryant
    , contributor
    Comments (6944) | Send Message
     
    Just the picture says he is not credible.
    12 Jul 2014, 11:42 PM Reply Like
  • 4ron
    , contributor
    Comments (26) | Send Message
     
    The reduction in distributed generation target from 8GW to 4GW was reported 3 weeks ago.

     

    http://bit.ly/1wn2UOy
    8 Jul 2014, 10:26 AM Reply Like
  • sunwindgeo
    , contributor
    Comments (856) | Send Message
     
    Isn't it interesting how these things get hashed and rehashed in ways that seem like part of a strategy to collapse solar stocks? Hope somebody reveals the truth one day.
    8 Jul 2014, 03:33 PM Reply Like
  • PeterKropotkin
    , contributor
    Comments (106) | Send Message
     
    The large drops in TAN don't really seem warranted on this kind of news.
    8 Jul 2014, 10:28 AM Reply Like
  • zangnut
    , contributor
    Comments (17) | Send Message
     
    This is not news, as the other comments noted. The real news is what was reported by the South China Morning Post about the up to 55% subsidy as the other poster noted. I really get sick of Seeking Alpha telling the side of the story they want to. The real news today is the subsidy increase that is a step away from being put in place.
    8 Jul 2014, 11:28 AM Reply Like
  • 7622061
    , contributor
    Comments (40) | Send Message
     
    This is shameful. There is no news here and no link to the "report" which itself is based on some alleged rumor. Also, as others have pointed out, NEA already announced it expects 10 GW in 2014.
    8 Jul 2014, 11:58 AM Reply Like
  • User 9086731
    , contributor
    Comments (25) | Send Message
     
    SA publications are biased so you should take everything here with a grain of salt
    8 Jul 2014, 11:59 AM Reply Like
  • thesofasurfer
    , contributor
    Comments (207) | Send Message
     
    this is sad. i read nothing but great news for the rest of the year for the solar industry and expansion and support of chinese companies by china but yet, a "rumor" is passed along via seeking alpha with no substance...you click the link and it takes you to some blogger acct (that is protected) with a picture of hannibal lector....wtf? and to make it more comical, thestreet picks up on it. shameful. everyone gets so many years to live their lives; for those that try to manipulate and scam others, i hope they don't live quite as long.
    8 Jul 2014, 12:09 PM Reply Like
  • sayeein
    , contributor
    Comments (14) | Send Message
     
    Can anyone please help me understand the last note:

     

    ""OTR's note comes amid a report the Chinese government plans to hike its subsidies for power sales stemming from rooftop solar projects by up to 55%, putting their revenue (on a per-kWh basis) on par with ground-mounted projects.""

     

    does this note go against the Chinese solar companines? Please elaborate.
    Thanks!
    8 Jul 2014, 12:44 PM Reply Like
  • hneumann
    , contributor
    Comments (630) | Send Message
     
    Solars don't sell off because of this news. It's because of the general market drop; solar stocks have a high beta.
    8 Jul 2014, 12:53 PM Reply Like
  • machiavelli
    , contributor
    Comments (723) | Send Message
     
    Just got some TAN... was waiting for a day like this to pull the trigger.
    8 Jul 2014, 12:57 PM Reply Like
  • DSW22
    , contributor
    Comments (61) | Send Message
     
    This looks more like a knee jerk sell off from those not wanting to be holding the bag when the real sell off occurs … certainly FSLR off 7% on erroneous Chinese 'news' is overblown otherwise. Re-opened a small position in FSLR @ 62.45.
    8 Jul 2014, 01:04 PM Reply Like
  • jeffrey mac
    , contributor
    Comments (12) | Send Message
     
    then why dont you guys look at this as a buying oppurtunity and buy some shares today?.......i did
    8 Jul 2014, 01:04 PM Reply Like
  • sayeein
    , contributor
    Comments (14) | Send Message
     
    the problem is that YGE is not picking up the pace. They need to publish some good catalysts in order for investors to restore their trust in YGE.

     

    Its a good company but investors are very cautious. And overall market is scared too because of the new HIGHS hype.
    8 Jul 2014, 01:16 PM Reply Like
  • 7622061
    , contributor
    Comments (40) | Send Message
     
    hneumann, this is not necessarily the case. This news travels and fuels the fire, with real new agencies citing it as part of what's driving shares down: http://reut.rs/1jbZzPI

     

    Also, July 1-3 when the markets were reaching all time highs, Chinese solar shares were down, 30-50% off peaks this year, so it's not just about the beta and broader market moves.

     

    this is a good buying opp, I would agree, but YGE is toast unless they get bought out by a larger company that can handle that level of debt; of course, a larger company would prefer to just buy JKS, TSL or CSIQ, so it's hard to see YGE surviving unless China demand really takes off with decent margins fast.
    8 Jul 2014, 02:19 PM Reply Like
  • mcactg
    , contributor
    Comments (2) | Send Message
     
    anyone looking at CSUN partnership agreement with the Chinese gov't "48th Research Insitute of China" with 8000 reported employees and some of China's best engineers and reported on the major news wire service yesterday morning - at the market opening?
    8 Jul 2014, 04:44 PM Reply Like
  • Quinn999
    , contributor
    Comments (42) | Send Message
     
    This has become an appallingly irresponsible site. It's being gamed top to bottom, and it seems like they don't give two hoots.
    8 Jul 2014, 02:40 PM Reply Like
  • sayeein
    , contributor
    Comments (14) | Send Message
     
    YGE is the biggest solar company in the world. Who will buy it?
    I think if it manages to show profit in the next earning call and up their target then the shares will skyrocket,IA.
    8 Jul 2014, 02:58 PM Reply Like
  • 7622061
    , contributor
    Comments (40) | Send Message
     
    Suntech was the biggest solar company in the world once.

     

    Even if profitable, you have to be able to finance your debt, especially if it's growing faster than your margins.
    8 Jul 2014, 03:12 PM Reply Like
  • sunwindgeo
    , contributor
    Comments (856) | Send Message
     
    This is temporary. Payback and pressure over tariffs is what it seems like to me. Obviously I'm not a China expert but it just stands to reason that with the USA placing a trade tariff on them they might resort to this and also see it as a kind of strategy. Furthermore what better way to build some capital than to manipulate some solar stocks so you can profit again on way up?

     

    Meanwhile, profits at Sunpower not dependent on China, which is not the only nation doing installations at any rate. Did they cancel this contract for a Sunpower solar plant in China? Doubtful, as that would have been a story for market news. http://bloom.bg/1lRIHZs
    8 Jul 2014, 03:31 PM Reply Like
  • sunwindgeo
    , contributor
    Comments (856) | Send Message
     
    Mosaic, not going to replace Sunpower or other US companies but interesting.
    8 Jul 2014, 03:49 PM Reply Like
  • legendtrade2008
    , contributor
    Comment (1) | Send Message
     
    The whole thing is BS. Those who posted the "news" were told to do so. There is nothing impossible for the Chinese government wants to do if they put up a target. Think of impossible, how many analyst in fact believed the "3 Gorge Project" were possible in such a short period of time?
    8 Jul 2014, 04:44 PM Reply Like
  • medzjohn
    , contributor
    Comments (491) | Send Message
     
    Solar is proving itself more valuable and more reliable every day. Every solar installation is a permanent reduction in system power demand. People hear their neighbors talk about how great the deal is and demand for solar snowballs. What could possibly stop this momentum?
    8 Jul 2014, 06:22 PM Reply Like
  • wheelz23
    , contributor
    Comments (66) | Send Message
     
    Here's some more good news for solar that is being ignored by most financial outlets: http://cnb.cx/1kVR1aU
    14 Jul 2014, 12:50 PM Reply Like
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