Sep. 12, 2014, 2:14 PM
- Solar stocks are on the move after Trina Solar (TSL +3.7%) CEO Gao Jifan says its factories are operating at full capacity but the company still can't meet the demand for its solar panels.
- China's top three solar panel makers are at full capacity and will have to expand their production, Gao says, noting that TSL's solar panel production will rise to 3.8 GW by year-end, up from ~3.4 GW at the end of June.
- China recently announced new subsidies for smaller solar energy projects, which Goldman Sachs says will make selling power to the country's electrical grid much more lucrative for the operators and will cause prices of solar components to rise.
- CSIQ +2.6%, CSUN +7.4%, YGE +3%, FSLR +1.7%, SPWR +0.8%, JASO +2.4%, SOL +5.4%.
- ETFs: TAN, KWT
Aug. 7, 2014, 10:05 AM
- SunEdison (NYSE:SUNE) recognized revenue from 54MW of solar systems in Q2, below guidance of 60MW-80MW. But it also retained 164MW on its balance sheet, better than guidance of 100MW-120MW.
- The company now expects to finish 1GW-1.15GW of solar systems in 2014, at the high end of prior guidance of 900MW-1.15GW. Revenue is expected to be recognized from 290MW-310MW (down from 460MW-580MW), and 710MW-830MW are expected to be retained (up from 440MW-570MW).
- In addition, SunEdison forecasts average 2014 project pricing of $2.50-$3.00/watt, better than prior guidance of $2.40-$2.75. That's providing a lift to EPS, which beat consensus by $0.40 in Q2.
- Solar project pipeline rose by 700MW Q/Q in Q2 to 4.3GW, and backlog by 100MW to 1.1GW. 475MW of the pipeline is under construction, up from 463MW at the end of Q1 and 200MW a year ago.
- Gross margin was 4.6% vs. 3.8% in Q1 and 5.9% a year ago. An aggressive construction pace led free cash flow to total -$80.2M. SunEdison ended Q2 with $954.7M in cash/equivalents, and $5.39B in debt. ~$3.5B of the debt is directly tied to solar systems financing.
- Peers SunPower (SPWR +4.2%) and SolarCity (SCTY +2.8%) are also rallying. SolarCity reports after the bell.
- Q2 results, PR
Aug. 1, 2014, 12:26 PM
- Solar stocks are underperforming (TAN -4%) amid a market selloff after SunPower (SPWR -8.5%) posted mixed Q2 results and provided Q3/2014 guidance ranges with midpoints below consensus.
- SunPower also announced it's building a new plant (Fab 5) that could go live in 2017 and eventually produce 700MW+/year of modules, boosting its capacity by over 50%. "Our share has been in single digits for a while and demand for the last 24 months suggests that we can expand share," says CEO Tom Werner.
- The announcement comes 6 weeks after SolarCity (SCTY -3.5%) unveiled plans to build a 1GW+ module plant with newly-acquired Silevo's help, and said it will later build "one or more significantly larger plants at an order of magnitude greater annual production capacity."
- Minimal capacity investments, together with rising U.S./Asian demand, have helped module prices stabilize following gut-wrenching declines in prior years.
- Also: SunPower stated on its CC (transcript) it hasn't decided whether to create a solar project YieldCo similar to SunEdison's (SUNE -4.3%) TerraForm Power (TERP -4.7%), which recently turned in a strong IPO. "It does not look like the company is likely to make a decision anytime soon," says Raymond James.
- Nonetheless, Brean has upgraded SunPower to Buy, citing optimism about strong demand and healthy pricing.
- Other notable decliners: FSLR -3.6%. TSL -8.4%. JKS -6%. CSIQ -5.6%. CSUN -5.7%. YGE -5%. SOL -4.5%. ENPH -5.8%. RGSE -4.5%. HSOL -3.9%. JASO -4.4%.
Jul. 31, 2014, 4:52 PM
- SunPower (NASDAQ:SPWR) expects Q3 revenue of $600M-$650M and EPS of $0.15-$0.35; the midpoints are below a consensus of $636.8M and $0.29. Full-year guidance is for revenue of $2.5B-$2.65B and EPS of $1.10-$1.40; the midpoints are below a consensus of $2.59B and $1.31.
- Q2 gross margin was 19.5%, down from Q1's 22% but flat Y/Y. GM is expected to fall to 17%-19% in Q3, but is also expected to be in a 19%-21% range for the whole of 2014.
- SunPower expects to recognize revenue in 2014 from 1.225GW-1.3GW of solar product sales. The company's total pipeline is at ~8.4GW - 3GW in the Americas, 2.6GW in Asia-Pac, 2GW in the Middle East/Africa, 800MW in Europe.
- The Americas were 72% of Q2 revenue, EMEA 10%, and Asia-Pac 18%. Solar products revenue totaled $237M, systems revenue $338M, and lease revenue $33M. 311MW of solar cells were produced, up from 306MW in Q1 and 296MW a year ago.
- Q2 results, PR, datasheet, slides
Jul. 31, 2014, 4:18 PM
Jul. 28, 2014, 7:59 AM
- Solar names are under pressure following the U.S. government's move to place anti-dumping duties as high as 165% percent on solar panels and cells from China.
- China condemns the action, saying "if escalating problems in the China-U.S. solar industry are ignored, in the end it will damage up and downstream industries in both countries."
- Moving sharply lower premarket: YGE -5.1%, CSIQ -4.3%, JKS -3.8%, TSL -2.7%, JASO -2.5%, SCTY -2.2%, HSOL -4.9%
- Moving up: SPWR +1.8%, FSLR +2.7%.
- ETFs: TAN, KWT
Jul. 27, 2014, 10:18 PM
- The Commerce Department has imposed preliminary anti-dumping tariffs ranging from 26%-165% on Chinese and Taiwanese solar cell/module imports. The tariffs come on top of the anti-subsidy tariffs imposed in early June, and in spite of a WTO ruling declaring U.S. solar tariffs violate global trade rules.
- Among the affected exporters,Trina (NYSE:TSL) is getting off the lightest: Between the June and July tariffs, it's dealing with a combined rate of 29.3%.
- Yingli (NYSE:YGE), Canadian Solar (CSIQ), and Hanwha (NASDAQ:HSOL) are set to pay a combined rate of 47.27%, and Suntech (NYSE:STP) a combined rate of 49.24%. ReneSola (NYSE:SOL) and JinkoSolar (NYSE:JKS) have to pay a 58.87% anti-dumping rate.
- Chinese module makers can pay 2012 tariff rates instead if they use Chinese (rather than Taiwanese) cells. Those rates are generally a little milder, often ranging from 24%-31%.
- "The tariffs in this case are so high as to prohibit basically any manufacturer from selling at a competitive price in to the U.S," says GTM Research's Shayle Kann. A final DOC ruling on the tariffs is expected around Dec. 15, and an ITC ruling on Jan. 29. (the full ruling - .pdf)
- U.S. rivals First Solar (NASDAQ:FSLR) and SunPower (NASDAQ:SPWR) stand to benefit. Their shares rose following the June tariff announcement.
- Other Chinese solar firms: JASO, CSUN, LDK
Jul. 8, 2014, 10:08 AM
- 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.
Jul. 2, 2014, 9:49 AM
- Canaccord has launched coverage on SolarCity (SCTY +4.4%), SunEdison (SUNE +1.2%), Canadian Solar (CSIQ +2.3%), and RGS Energy (RGSE +4.7%) with Buy ratings.
- SunPower (SPWR +0.6%) is up slightly in spite of being started at Hold.
- Canaccord's Josh Baribeau predicts the solar industry as a whole will benefit as "financial innovation such as risk pooling, securitization, de-levering etc. continue to drive the costs of capital and system costs downward."
- Baribeau expects SolarCity ($94 PT, leading the securitization trend) to beat Street deployment estimates, and to see strong cash flow growth with the help of declining component and financing costs.
- He likes Canadian's low manufacturing costs, industry-leading commercial backlog, and relatively low Chinese sales dependence. His target is $43, or 10x 2015E EPS.
- Solar ETFs: KWT, TAN
- Previous: Deutsche upbeat on solar YieldCo potential
Jun. 18, 2014, 9:47 AM
Jun. 17, 2014, 12:55 PM
- SolarCity has announced plans to build a 1GW+ module plant in NY, and to follow it up with one or more much larger facilities. Notably, the company declares (in spite of a current capacity glut) it needs to build the plants to meet long-term solar demand.
- Yingli missed Q1 estimates, but reported a healthy gross margin (thanks in part to strong Japanese sales) and reiterated full-year guidance.
- Also: Goldman is out with a bullish note, predicting rooftop solar installations will post a 40% CAGR through 2016.
- Gainers: FSLR +2.8%. SPWR +4.2%. SUNE +4.4%. JASO +8.2%. SOL +7.5%. JKS +6.5%. CSIQ +7.4%. DQ +4.2%. ASTI +3.9%. HSOL +6.9%. TSL +5.6%. ENPH +3.5%. CSUN +3.7%. RGSE +11.3% (announced a new Hawaiian deal).
- SolarCity's plans are a positive for equipment vendors GT Advanced (GTAT +1.5%) and Veeco (VECO +1.6%), each of which has seen its solar orders plummet thanks to the capacity glut.
- Solar ETFs: KWT, TAN
- Yesterday: Solar stocks rally; Deutsche upbeat on YieldCo potential
Jun. 16, 2014, 11:05 AM
- "We are becoming increasingly constructive on the solar sector as we expect further tightening of the solar supply/demand balance and expect increased investor interest driving valuation multiple expansion," says Deutsche, which last month struck a far more cautious tone on the industry.
- The firm adds it expects "the emergence of 5-6 publicly traded [solar project] YieldCos over the next 12-18 months to act as a robust growth enabler." It has upgraded SunEdison (SUNE +6.4%), which recently filed an S-1 for its TerraForm Power (TERP) YieldCo, to Buy.
- YieldCo momentum is seen growing ahead of potential 2016 U.S. solar tax credit changes, and greater international activity is expected to start in 2015, as grid parity is reached in more markets.
- Notable gainers: FSLR +3%. SPWR +4.7%. CSUN +5.2%. SOL +4.8%. RGSE +3.4%. HSOL +3.4%. YGE +3.3%. CSIQ +3.1%.
- SunPower might also be getting a lift from news of a $200M, 2-year loan program with Admirals Bank to finance U.S. residential solar projects. SunPower has already reached residential financing deals with Google and BofA/Merrill this year.
- Solar ETFs: KWT, TAN
Jun. 6, 2014, 9:34 AM
- SunPower's (SPWR -0.9%) $400M offering of convertible senior notes due 2021 features an interest rate of just 0.875%, and an initial conversion price of $48.76 - a 44% premium to current levels.
- Net proceeds are expected to total $395.3M. The offering terms are notably better than the ones Trina just received for its $150M convertible offering.
- Previous: SunPower announces $400M convertible debt offering
Jun. 4, 2014, 4:49 PM
- SunPower (SPWR) is offering $400M worth of convertible senior notes due June 2021.
- Total (TOT), which owns 60% of SunPower, has committed to buying $250M of the notes.
- Potential uses of the funds include capex, paying down existing debt, and pursuing SunPower's HoldCo strategy, under which the company is creating a solar project subsidiary that in turn could sell a stake (possibly through an IPO).
- SunEdison announced a $500M convertible offering earlier today; the majority of its proceeds will go to the company's TerraForm Power (YieldCo) spinoff.
- SunPower rose 7% in regular trading, thanks to the DOC's tariff announcement. The company had $900M in debt at the end of Q1, and $1.32B in cash/investments.
Jun. 4, 2014, 9:30 AM
- The Department of Commerce has imposed new preliminary tariffs on Chinese solar module imports, covering both modules featuring Chinese and non-Chinese cells. Trina (NYSE:TSL) is seeing an 18.56% tariff, bankrupt Suntech (NYSE:STP) a 35.21% tariff, and most other firms a 26.89% tariff.
- The move follows a complaint from Germany's SolarWorld that Chinese firms are using a loophole involving imported cells to sidestep the DOCs 2012 tariffs. A separate anti-dumping decision is due on July 25.
- Morgan Stanley notes many were expecting either a lower tariff (perhaps around 15%) or a settlement similar to the EU/China deal. Not surprisingly, the Chinese government says it's "strongly dissatisfied" with the DOC's action, and warns it could hurt trade ties.
- Chinese solar exporters are off: TSL -6.2%. YGE -5.8%. CSIQ -5.1%. JKS -8.8%. JASO -4.4%. CSUN -3.3%.
- U.S. peers First Solar (FSLR +2.5%) and SunPower (SPWR +5.5%) are higher. But SolarCity (SCTY -2.8%) and SunEdison (SUNE -3.5%) are off, as investors fear higher panel costs for solar projects. Also: SunEdison has announced a new $500M convertible debt offering. $350M-$400M of the proceeds will go to its TerraForm Power (Pending:TERP) spinoff.
- Solar ETFs: KWT, TAN
Jun. 4, 2014, 9:13 AM
SPWR vs. ETF Alternatives
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