dicki31785

As Solar Sector Flies, Pay Attention to Values

I wouldn't discount the risk and the capital, needed, involved becoming a vertical player....surely it is a nice idea and everybody in the space seems to be heading that way....Since you can save a "couple" basis points of margin at every step of the supply chain....but you gotta be good at what you are doing....You can't jsut become a vertically integrated player and thats the end of the story....it involves a bit more than that....

my favorites from China are STP, SOLF, TSL ( I am long TSL)...SOLF i liked because it showed the most resiliency in the downturn (rev % change Q3 08 to Q1 09)STP because of Pluto...once the get their costs under better control they should take off(not spending 80 million on office HQ and high executive compensation would be a good idea etc., etc.)...and Trina my absolute favorite...I just like everything about them....we will see if I am right in a couple hours...the run up leaves lots of room for disappointment...but I am fairly optimistic that they managed to steer through Q1 quiet well...guesstimate of $140-160 mil in rev and a small loss....

With Kind Regards From Germany

CW

SolarWorld's Asbeck: Panel Prices to Drop 10% in 2009

FYI This is an estimate that takes the base price from Q4 2008 meaning that a big price drop is already incorporated....and thus is not comparable to the STP prediction which has the base of Q3 2008 with kind regards from Germany CW

SunPower Is a Semi - It Deserves to Be Valued Like One

Well at these valuations actually I am actually not very bullish concerning SPWR or FSLR(at 60$ and 200$ they are both a definite buy)...Though SPWR and FSLR management both seem to be excellent….and could both play a significant role when this all plays out...

My point was the Demand will be out their next year...and ASP will fall but not as significantly as expected...And the future will tell if we reach grid parity or not...You made your case based on subsidies working well for natural fuels....And saying subsidies for solar do not.....who says subsidies for solar do not work?

In Germany(where I live) we spent the most amount of money on subsidies on the planet and we are quiet happy with them...The average German actually gladly pays a premium for energy if it is clean(wind, solar etc.) compared to coal, gas, and nuclear (yes nuclear doesn't produce CO2 but nuclear waste seems to be quiet an issue if I may point that out)....So you just say subsidies work for fossil fuels and not for renewables based on basically nothing....I can tell you it works and I am happy paying a little premium on the electricity price....In the future we are not as reliant on power and building a solar industry that is creating a significant amount of jobs and solar companies that pay a good chunk of taxes(Though I guess we dish them out again for the subsidies but I think it is beneficial as whole to Germany and the planet)

Furthermore you compare solar to Ethanol....They are not comparable IMO...Solar is here to stay...why do you think the big boys are coming in....Intel for example has entered the industry or GE....The achievable cost reductions are quiet big...Poly for example is the main cost of a panel at the moment …(besides FSLR and a few others)...But with more and more supply hitting the market this will change...and these are not the only cost reductions you can achieve take for example FSLR....they increased their throughput by 5% in one quarter!!! Also there are technologies such as UMG, Pluto, Quad, etc. that can differentiate a stock by leading to faster cost reductions...So to conclude I do not think you are right solar subsidies do not work and solar will achieve grid parity it is just a matter of time….With kind regards from Germany CW

Long ABX, AUY, CSIQ, ESLR, SSL, TSL

SunPower Is a Semi - It Deserves to Be Valued Like One

Well I think the poly supply, as you pointed out, will not be an issue anymore at the latest 2010....I have heard from a friend at Wacker Chemie(One of the biggest poly producers in the world) that they are, even further, moving towards selling forward contracts...Wacker has been always pretty conservative with those contracts...but it looks like they are preparing for Poly prices to come down significantly....

I chose MW installed for the simple reason that all you read about, nowadays, how ASP's for PV are supposed to tumble significantly...thus eroding margins....Since, supposedly, without Spain their is not enough demand leftover to keep the ASP's at an acceptable level...But as one can see from my "chart" Worldwide growth is unstopped....Certainly growth will slow a bit...when the base gets bigger and bigger that is not an unusual phenomena...but if Grid Parity is reached around 2010-2011 demand is endless...In any case that is why I chose MW installed...

Additionally you bring a valid to the surface...I mean why is it alright to subsidize oil and gas in the US but subsidies for renewables are just the devil????Ill tell you why...some have more dollars left over for lobbying than others....But what one doesn't take into account...Is what happens to energy prices when you start trading CO2 emission certificates...because that will be added to the cost of energy....Because with those certificates we are actually quiet a bit closer to grid parity then one would expect...So this is another point one should seriously incorporate into his/her consideration of the future of PV and renewables in general....Because once companies pay for polluting things aren't that easy anymore just ask RWE (German based power company) scrambling to get rid of some of their coal plants or adding renewables to the portfolio in order not pay such a high CO2 bill....with kind regards from Germany CW

SunPower Is a Semi - It Deserves to Be Valued Like One

Obviously the numbers that I am referring to above are PV installations in MW Worldwirde

SunPower Is a Semi - It Deserves to Be Valued Like One

After a lot of work, and great thanks to Meinolf67 for helping me out with a few numbers, I have finished my projections for 2008 and 2009 with a look back at 2007....I am going to post it comment less...I would quiet appreciate some comments...if somebody has information to the contrary concerning my numbers I would like somebody to point it out:)(concerning the growth numbers I choose as a Benchmark for 2008 the good scenario which equals 4147 MW and furthermore sorry for the format but couldn't format it better in this text box...)
So Here we go:

Worldwide In MW 2009
World= 4783-6778(15.3%-63.4% Growth) =Median(60 % Bad Scenario 40% G.S =5581.0
Worldwide In MW 2008
World= 3905-4147(43.4%-52.3% Growth) =Median(50%/50%)
=4025.5
Worldwide In MW 2007
World= 2722.53


2009 Other than EU in MW
Japan 500
USA 800 - 1000
China 50 - 70
India 50 - 70
South Korea 200 - 300
Israel 30 - 50
=
1630 – 1990 (75.2%- 113.9%)
2008 Other than EU in MW
Japan 300
USA 400
China 25
India 100
South Korea 100
Israel 5
=
930 (60.6% Growth)
2007 Other than EU in MW
Japan 230
USA 259
China 20
India 20
South Korea 50
Israel 0
=
579



2009 Solar Installations in the EU (inc. SUI) in MW

Germany 2000- 2500
Spain 300-950
Italy 300-400
France 200-350
GB 5-10
Czech Rep. 50
Swiss 10 (New Solar Subsidy in place)
Portugal 40-60
Greece 100-300 (2 GW in the pipeline)
Belgium 40-50
Netherlands 8
Rest of EU 100
=
3153-4788 (if 2975 MW were installed in 2008 then 5.9%-60.9% Growth if 3217 MW were installed then -2%-48% growth)

2008 Solar Installations in the EU (inc. SUI) in MW

Germany 1600
Spain 1000-1200
Italy 120- 150
Portugal 30
France 100
Swiss 3
GB 3-5
Czech Rep. 20
Austria 4
Greece 50
Belgium 20-30
Netherlands 4
Cyprus 1
Rest of Europe 20
=
2975-3217 (38.7-50 % Growth)


2007 Solar Installations in the EU (inc. SUI) in MW

Germany 1328
Spain 640
Italy 90
Portugal 14
France 50
Swiss 2
GB 3.4
Czech Rep. 3.1
Austria 3.01
Greece 3
Belgium 2
Netherlands 2.30
Cyprus 0.72
=
2141.53
Rest of Europe 2
=
Total 2143.53

In the Battle of Best Solar Plays, U.S. Is a Distant Second

I Think your post is sort of misleading....Germany'... plan was to take nuclear power of the grid at a certain point of time....whether the plant could run longer or not....Thus abolishing nuclear power...This is indeed still the plan though....The only difference now is that they said "energy prices are quiet high so why not keep them until their lifetime is used up"...Furthermore the excess profits that the companies would get from keeping them on longer(since their is not really that big of costs to still incur....its just pure cash for the companies such as Eon, RWE, Vattenfall etc.)...would not all go directly into the pockets of the companies...actually Germany is planning on using that money(by some sort of extra tax or something of that sort) to pay off (part of)the bill for their renewable energy subsidy....So the move Germany is making is actually quiet friendly to the renewable energies around the world....

To SPWR...If you look at present numbers obviously 28 million net income is not enough for that valuation....but as we all now the stock markets incorporates in its valuation the future....And SPWR is actually quiet well managed and if it goes back down to $60 a strong buy....SPWR strategy relies on buying sales offices in expanding solar markets(Italy, Australia....etc.etc.) and thus gaining solid traction in these markets...The Spanish subsidy cuts I already have discussed and surely won't be as severe as expected, though it is about time Spains gov't clears up the situation so companies can plan better...and a lot of uncertainty which is surrounding solar stocks presently would be gone...Well my point was SPWR won't go down to the 20's....as they always say buy when the mood is the worst...and for solar stocks the outlook is pretty gloomy, predominantly, right now so it could be a buying opportunity...With kind regards from Germany CW

Long ABX, AUY, CSIQ, ESLR, SSL,TSL

SunPower Beaten up to Buying Opportunity Levels

@Deep Value....all the uncertainties in the German market are gone....They implemented declines in solar subsidies 8% y-o-y without a cap and thus Germany should continue to be a great market for solar and other renewables kind regards from Germany CW

Concerning SPWR...for the long-term SPWR is always a buy at around 60...Really nice management...really nice panels(best efficiency industry wide)...but does have some valuation issues...but at around 60 I personally wouldn't mind the valuation issues anymore....It is certainly not as bad as FSLR valuation I really do not get why that stock is liked so much...Their panels have some serious issues, concerning the longer term, and the valuation is just absurd....With kind regards from Germany CW

Long ABX, AUY, CSIQ, ESLR, SSL, TSL

In the Battle of Best Solar Plays, U.S. Is a Distant Second

@Rob Doc In Germany we got decreases of 8% per year(without a cap)....Why should the government(tax payer) pay for the margin of these companies....In Spain a harsher reduction will come....Not as bad as feared but still significant I see a cap of 750 MW and a cut of subsidies around 20%....(compared to analysts saying a cap of 300 MW and subsidy cuts of up to 30%)Which is still isn't enough to curb demand that much(1.1 GW vs 750 MW)...Although i could also imagine the scenario of 30% subsidy cuts without a cap....which is much better scenario for solar makers since demand won't be effected as much as one would expect thanks to Spain's placement on the "solar map"

Since other countries are putting bigger subsides online such as Korea, Italy, Switzerland etc. etc.......It is only natural the countries with already a lot of PV cut their subsidies a bit while prices are coming down....and countries still lagging behind are bringing programs online....So the subsidies in Europe are much more stable and EXPANDING even with the Spain factor(Not even to mention worldwide subsidies which are increasing as well)....And if an American program ever does come around, in a large scale, it will help that much more....Including other countries such as China, Great Britian, Greek (once they focus on solar expect this to be a HUGE market), India, France, etc. etc. etc.

In any case my point is that Germany and Spain lowering their Subsidies is normal, if Spain does not overdue it, since the costs are coming down and thus not that high amount of subsidies is needed to keep demand for Solar high!In Germany we for example we expect a significant increase in solar installations, despite the 8% decrease in subsides. With kind regards from Germany CW

Long ABX, AUY, CSIQ, ESLR, SSL, TSL

In the Battle of Best Solar Plays, U.S. Is a Distant Second

*that is why my main holdings are in CSIQ + TSL

In the Battle of Best Solar Plays, U.S. Is a Distant Second

The American solar shares trade also at a huge premium compared to the Chinese counterparts....FSLR especially...SPWR is not cheap by any means either....ESLR has, roughly, twice the market cap of CSIQ with sales of what $16 million....Showing that these firms are just not as cheap as the Chinese, or even German or Spanish firms....

Concerning the three stocks FSLR will be eaten alive, I mean just destroyed...I would be quiet surprised if they manage to ever see their ATH again....(but they got major support from the institutional investors) I do not believe in thin film(poor efficiency but cheaper thats not enough)....also the Telleraium issue....Their advantage will be eaten up in no-time if a lot of Poly becomes available...

SPWR I like due to its management....ESLR I just bought after Q2 results....The Quad technology is quiet nice and the stock will explode when the first solid earnings come in sight.(Probably Q4 2008-Q1 2009)...But in summary they are just quiet expensive with no advantage that justifies their premium to Chinese counterparts(yet)........ why my main solar holdings are in CSIQ and TSL...

They took care of their financing problems....and it looks like they might have found a bottom....With Kind regards from Germany
CW

Long ABX, AUY, CSIQ, ESLR, SSL, TSL

Canadian Solar: The Next Solar Takeover Target?

Agree with you "user" to a certain extent...I am long as well....Since 16 on and off....and if we get offered a 100$/share and up....i would take it but otherwise no thank you!!!After Q2 results we are going to go through the ATH easily and stand around 60$/share and then we would at least a premium of 50-100% with those growth rates....so between $90-120 would be the price for a takeover which is still ridiculously cheap actually in the long term as you pointed out...but who knows their is still some unknowns and if would get a 200% premium it would be tough to say no....

@Kelvin Schulle nice article....but sell those FSLR longs if you like your money...;):)Alternativ... are TSL (based on value) and LDK(if poly stays constrained that should be quiet the nice investment...though I have some info to the contrary concerning Poly)...but FSLR...at that valuation...and not even that great of a technology since you need twice the panels to reach the same efficiency as SPWR but the panels cost half....so i can't really see the adv. of holding FSLR...and the problems your fellow writer mark anthony mentioned are also worth taking a look at....
kind regards from Germany

CW

Which Solar Stocks Will Continue To Shine?

Just look at the guidance Buystocks and then do the math...with kind regards CW

Which Solar Stocks Will Continue To Shine?

Dear Jack,

Exactly what you said is correct while listening to the TSL conference call this afternoon...the first thing that stuck out was that 4 million dollar charge they took....really made the earnings look "disappointing" while they were really not disappointing at all....Another point that you did not mention and I would like to add is Trina's position in Italy...They positioned themselves excellent in order to take advantage of that emerging solar market...IMO it will be the next Spain....and currently Trina holds a market share of 25% in that market and if you looked at where their products go in the near future they will even expand that markertshare...

Also you did not really get into reduction of unit costs which look quiet promising...with poly costs dropping at least 12-15% in the next year(more realistic is 20%...TSL is conservative in the estimate which surely is not a bad thing) and also non poly costs reduction from $1.17 to 1.05 by the end of the year...So I think their is actually a possibility of a margin expansion....rather than a margin squeeze which other companies possible face with reductions in feed-in tariffs in ESP and GER...All in all the numbers were quiet good and as you said it is so cheap...and after a couple people do their math and raise guidance the stock will go up....I added to my position as well today and will continue doing so in small steps since they are, as you also said, so volatile but i do not expect a big pullback....

also i know it is kind of outta the way....but it looks like the ECB is quiet serious about raising those interest rates(The German Central bank is putting quiet a lot of pressure on them) and if it does not happen this month it will happen next month...putting further pressure on the dollar and this will obviously raise commodity prices...I doubt that is smart for Europe but that was not the point I was trying to make:)...Kind regards from Germany CW

Walter Nasdeo Discusses Solar Energy

I agree a nice article but certainly nothing new..with kind regards CW