Tue, May 19, 11:26 AM
- Solar stocks are selling off for the second day in a row (TAN -1.7%) as Yingli (YGE -42.4%) plunges into penny stock territory after disclosing in its 2014 annual report (filed after the close last Friday) its financial woes "raise substantial doubt about [its] ability to continue as a going concern."
- Decliners include Chinese firms JinkoSolar (JKS -3.3%), ReneSola (SOL -6.4%), Trina (TSL -4.8%), and China Sunergy (CSUN -6.5%), as well as China-exposed Canadian Solar (CSIQ -4.8%), which yesterday held its investor day (presentations can be found here).
- U.S. firms SunPower (SPWR -3%) and Enphase (ENPH -2.9%) are also off. Enphase's decline comes in spite of an upgrade to Strong Buy from Needham.
- Yingli CFO Wang Yiyu downplays his company's disclosure, which has sparked fears Yingli will be the next Suntech or LDK Solar. "Potential risks don’t mean they will happen and don’t mean Yingli is facing or will face such risks. They shouldn’t cause an overreaction.”
- Wolfe Research's Gordon Johnson (formerly with Axiom, bearish on solar for a long time) thinks Yingli's disclosure has "caused a lot of investors to overlook massive debts on the balance sheets of pretty much EVERY publicly traded Chinese solar company," and that a Yingli liquidation could affect credit access for peers.
- RBC's Mahesh Sanganeria, however, argues Yingli's problems are company-specific. "It is well understood by now that global solar demand is strong this year, as evidenced by a number of large contract signing announcements, active solar project development and acquisition, and positive company earnings." He does admit solar cell/module prices have been falling, but suggests this is partly due to lower costs, along with a weak yen/euro and lower polysilicon prices.
Thu, Apr. 30, 5:57 PM
- Though SunPower (NASDAQ:SPWR) insists its "underlying business fundamentals remain strong for 2015," the company is refraining from providing 2015 guidance "until the company can finalize the estimates regarding the impact" of its 8point3 Energy YieldCo JV with First Solar. The company has guided for 315MW-350MW of Q2 module deployments, and 200MW-230MW of module revenue recognition.
- No explanation is provided in SunPower's earnings release for its Q1 revenue miss - First Solar just cited (among other things) the retaining of projects for the YieldCo as a factor behind its Q1 miss.
- Revenue recognition timings led power plant revenue to fall 49% Y/Y to $226.2M. Commercial solar revenue fell 36% to $49.1M. Residential solar fell 6% to $155.3M.
- Gross margin (non-GAAP) was 20.5% vs. 20.4% in Q4 and 22% a year ago. 319MW of modules were produced vs. 313MW in Q4 and 306MW a year ago.
- Shares have fallen to $30.78 AH.
- Q1 results, PR, slides (.pdf), datasheet (.pdf)
Thu, Apr. 30, 4:06 PM
Thu, Apr. 16, 11:21 AM
- SunPower's (SPWR +1.9%) Sichuan Shengtian New Energy Chinese solar project JV is partnering with Apple (NASDAQ:AAPL) to build two solar plants with a combined 40MW of capacity in Sichuan Province.
- The projects are under construction, and are expected to be finished in Q4. SunPower notes it has already partnered with Apple on 6 California, Nevada, and North Carolina projects with a combined 90MW of capacity. In February, First Solar announced a deal to build an $850M solar farm for Apple and PG&E.
- SunPower's Q1 report is due on April 24.
Tue, Mar. 10, 10:02 AM
- Two weeks after announcing they're discussing a joint solar project YieldCo (and seeing their shares soar in response), First Solar (FSLR -1.4%) and SunPower (SPWR -2%) have filed a public S-1 for the JV, known for now as 8point3 Energy Partners. (PR) (prospectus)
- Each company will own a 50% stake. No symbol has been proposed yet; Goldman and Citi will serve as underwriters.
- 8point3 will initially have interests in 432MW of First Solar and SunPower's solar projects; no word yet on initial quarterly cash distributions. At IPO time, the YieldCo will "own interests in six utility-scale solar energy projects, four of which are operational and two of which are in late-stage construction."
- Its initial 432MW asset base will consist entirely of U.S. projects, with most of them in California. They include First Solar's 150MW Solar Gen 2 CA project, and SunPower's 108MW Quinto CA project. 39MW of SunPower residential assets are also thrown in.
- The YieldCo also has right of first offer (ROFO) agreements for 1.13GW of projects, most of which will be finished in the 2015-2016 timeframe. 82% of the projects are in the U.S., 17%, in Chile, and 1% in Japan. 87% are utility-scale, and the rest commercial/residential.
- First Solar and SunPower have joined solar peers in selling off. The Nasdaq is down 1.1%.
- Previously: Analyst commentary on the YieldCo
Tue, Feb. 24, 1:16 PM
- SunPower (NASDAQ:SPWR) states in its Q4 earnings slides (.pdf) its planned solar project YieldCo with First Solar (NASDAQ:FSLR) will be a 50/50 JV, and promises it will lower the companies' cost of capital and improve their financing options for solar projects.
- Meanwhile, Deutsche's Vishal Shah (a long-time solar bull) has upgraded First Solar to Buy ahead of this afternoon's Q4 report, and declares the YieldCo could be "one of the best growth stories out there."
- Under "conservative assumptions," he sees SunPower and First Solar respectively having 640MW and 755MW of projects they can contribute, resulting in an equity value of $2.8B. Assuming an 85% payout ratio, Shah sees the YieldCo providing a 5% dividend yield. He adds the companies could each contribute another ~1.5GW of projects (via their pipelines) by the end of 2016.
- Raymond James' Pavel Molchanov compares the alliance to a Duke/UNC or Coke/Pepsi partnership. "By joining forces, First Solar and SunPower can create an asset base that is even larger ... With the S-1 set to be filed in 1Q, we see no reason why the IPO couldn’t take place in 2015."
- The YieldCo news is easily overshadowing SunPower's light Q1 guidance: Revenue of $410M-$460M and EPS of $0.05-$0.15 vs. a consensus of $544.7M and $0.25. Though the company says its "business fundamentals for 2015 remain strong," it's withdrawing its full-year guidance until YieldCo plans are finalized.
- SunPower recognized revenue on 293MW of solar systems in Q4, a little below guidance of 300MW-340MW. It expects to recognize 240MW-270MW in seasonally weak Q1. Q4 gross margin was 20.4%, +370 bps Q/Q and flat Y/Y. Q1 GM guidance is at 18%-20%.
Tue, Feb. 24, 12:45 PM
Tue, Feb. 24, 9:16 AM
Tue, Feb. 24, 8:02 AM
Mon, Feb. 23, 5:37 PM
Mon, Feb. 23, 5:30 PM
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Mon, Feb. 23, 4:41 PM
- First Solar (NASDAQ:FSLR) and SunPower (NASDAQ:SPWR) "are in advanced negotiations to form a joint YieldCo vehicle (the YieldCo) to which they each expect to contribute a portfolio of selected solar generation assets from their existing portfolio of assets."
- After reaching a deal, the companies plan to do an IPO for the YieldCo. Investors in both companies have been urging them to follow SunEdison's lead in launching solar project YieldCos; each had been non-committal until now.
- FSLR +9.7% AH to $54.44. SPWR +11.5% to $31.00. SunPower's Q4 report arrives tomorrow morning; First Solar reports after tomorrow's close.
Tue, Feb. 3, 10:59 AM
- Solar stocks are adding to yesterday's gains in a big way (TAN +3.6%) as oil prices (and oil/gas stocks) continue their recent rally: WTI crude is up $1.51 today to $51.08/barrel. The Nasdaq is close to breakeven.
- Also possibly helping solar firms: Canadian Solar's (CSIQ +21.2%) $265M deal to buy North American solar project developer Recurrent Energy from Sharp. The deal, which CSIQ estimates spells a $2.3B+ revenue opportunity, acts as a fresh vote of confidence for the downstream U.S. solar market in the wake of oil and natural gas' big declines.
- Notable gainers (besides CSIQ): FSLR +4%. SPWR +5.1%. JKS +8%. JASO +6.5%. SOL +7.1%. VSLR +6.3%. ASTI +7.7%. CSUN +7.7%. YGE +4.7%. HSOL +8.8%. DQ +3.4%. ENPH +5.8%. TSL +5.5%.
Mon, Feb. 2, 11:30 AM
- WTI crude oil soared above $48/barrel on Friday after ISIS attacked the Iraqi city of Kirkuk, and is holding its ground today. Oil/gas producers are rallying, and so are beaten-down solar firms (TAN +2.2%).
- Notable gainers: FSLR +6%. SCTY +9.2%. SUNE +5.5%. SPWR +4.9%. TSL +6.6%. JKS +4.8%. CSIQ +4.6%. DQ +13.2%. VSLR +4.4%. JASO +3.8%. ENPH +3.4%. HSOL +3.6%. YGE +4.3%. ASTI +3.1%. SOL +3.4%.
- RBC made a contrarian call on Friday, upgrading SunPower, JA Solar, and Trina to Outperform. A long list of U.S. and Chinese solar firms are expected to post Q4 results this month.
Fri, Jan. 30, 9:21 AM
- SunPower (NASDAQ:SPWR), JA Solar (NASDAQ:JASO), and Trina (NYSE:TSL) have each received upgrades to Outperform from RBC in the wake of the huge solar rout seen over the last few months. The firm's cites optimism about solar growth and SunPower's plans to build a 700MW+ module plant.
- SPWR +1.3% in spite of lower Nasdaq futures. JASO +2.5%. TSL +0.8%. SunPower reports on Feb. 24.
Tue, Jan. 27, 5:35 PM
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