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

Trina Solar Announces Largest U.S. Rooftop Project, 2009 Updates

I have read all the news in the article before as well Wojna12....so no new news to me either... but I am pretty sure some people are finding this helpful as well...and obviously it is more or less copy and paste but he referenced the article as well, so he wasn't going for something special here(I suppose)....I think he just wanted to give people a clear look on what is going on right now with the stock...and give all the latest news about Trina which he managed more or less IMO...Their is so much turmoil in the markets it took two days for the US to even register Trina's guidance for 2009....

IMO Their is no reason to take attack the guy...if you can do it better open up a blog(or whatever) and write about it...what do you get out of attacking the guy...sorta childish...isn't it?Could have been a nice discussion concerning TSL but instead we are commenting on your rubbish...Another option would have been to give feedback on your analysis that I suppose you did thoroughly...would have been a lot more constructive...but the window of opportunity is still open:)

In any case Trina is a good investment for the long-term(which in this market is about 3-6 months if the market doesnt get crushed otherwise average down the valuations are absurd)...demand for next year will be about 7GW, if y'all would like I can give you an expected breakdown(in MW...I recently updated the demand side and can give you the supply side as well though I did not research the supply side myself but somebody gave it to me and the numbers checked out) market by market, meaning the oversupply will not happen in 2009 as predicted....in 2010 this might be another story but with solar and the rapid advancements that are actually made, more or less, every day in the supply chain anything can happen....With kind regards from Germany CW

Trina Solar Announces Largest U.S. Rooftop Project, 2009 Updates

What insightful input Wojna12....just one question, if Trader Mark is writing rubbish how would your analyze your input?....Thanks for wasting 30 seconds of my life by reading your comments...with kind regards from Germany CW

PS Trader Mark with the current net profit margin, which is likely to expand, Trina is bound to make about 142 millions in 2009...surely have seen worse valuations;):)

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

Trina Solar: Still Attractive, Despite Stock Decline

dont know how this didnt make it onto american sites yet...

www.finanznachrichten....

Trina Solar: Will 2009 Be a Breakout Year?

PS....Obviously for a positive 1x time surprise the USD has to apprecaite vs RMB....and I am quiet unsure if that is going to happen...

Since on June 1st the dollar was worth about 6.95 RMB and now we are at 6.875(sadly enough) but the dollar is seemingly gaining some strength...certainly enough to appreciate vs the Euro, thanks to poor economic data in the EU zone....but can if it can manage to gain vs the RMB is a total different question...with kind regards CW

Trina Solar: Will 2009 Be a Breakout Year?

Yes mark!!!!I was quiet surprised as well when they suddenly presented 6 million dollars in foreign exchange lost....and expectations, including my own, were(are) so low that I didn't even care that much....I was just happy no, BIG, surprises were in the call this time around...

Though their were a couple very good things in the call and in general the call certainly wasn't bad at all...so the stock IMO can't go much lower might touch the 29 and then turn but certainly very had to predict....

A couple sentences certainly stuck out from Trina's management "Margins could increase in 09 if ASP's decline only by 6-8%"....And to be honest I am very bullish on ASP for next year....I think the decline will go along those lines....which means TSL will expand margins next year....Furthermore I like that they decreased the use of grams per watt from 7.5 to 7.2 (though they were aiming for 7 g/watt as I am looking through my notes from Q1) but I guess that will be reached next Q.....

They also said in the call that they basically cannot keep up with demand(as others said as well such as CSIQ, ESLR, FSLR etc. etc.)....Which also speaks for my theory that ASP's won't come down as much as expected...

And their exposure to Spain is really coming down a lot....from 45-50% in Q 2 to about 18% in the second half of 2008....(I do tend to think that Spain won't introduce such a drastic cap as expected but it is still positive to see the limited exposure to the market....And as I told Jack couple Q's ago Italy is going to be quiet strong....and indeed it is!And Trinas positioning in the Italian market is marvelous and actually other firms would love to have such strong positioning in such a rapidly growing market...

Lastly Poly prices are coming down for Trina by 15% due to long term contracts....(which is about the number you hear from most companies)but still a positive number, I think 2009 will going to be an excellent year...And if Trinas management actually manages to create a positive 1x time surprise next Q this year could be very strong because the valuation is actually quiet ridiculous...but thats what you get for the constant flip-flopping...With kind regards from Germany CW

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

Flummoxed by Solar Market Action?

I Actually have a preliminary version finished just with total MW installed in the EU (inc. Sui):

2007 1545.19 MW
2008 2190-2290 MW (41.0%-48.2% growth)
2009 2510-4000 MW (14.6%-82.6% growth)

2009 Their is certainly a lot of uncertainty as one can see by that huge low(2510) to high estimate(4000) difference of 1490 MW. The low number of 2510 is including the 300 MW scenario for Spain. And quiet the low Germany estimate of 1.3 GW of PV....And also very conservative estimates concerning France and Italy....Showing even with those estimates included their would still be growth in the EU zone of 14.6%...and then consider that worldwide subsidies will greatly expand and then you still have at a bare minimum growth rates of 20-25% and that is the worst case scenario....

So I feel pretty good about the sector at the moment actually...kept on buying CSIQ and TSL and diversified a little bit so I am pretty much strapped for cash in the short term...but I think solars may have found a bottom and if FSLR presents well after hours today....this could be a well deserved good week in the sector and maybe a start of a bull run if Spain announces something before their summer holiday....with kind regards CW

Flummoxed by Solar Market Action?

Dear Trader Mark,

Interesting view on California...but i wouldn't count on that yet....I am pretty cautious concerning your view considering in 2007 the US in total installed, depending on estimates, 150 MW....and to reach Germany, Cali would have to install 1,3 GW(2007 data).....Their is still huge steps to be done until 2011...But that California is ideal for solar power is undebatable...

Dear Jack...I Turned out to be pretty correct concerning Italy...I expect about 300 MW-400 MW out of them next year and 500-600 MW in 2010....Greece has a huge backlog for subsidies about 2 GW of PV projects applied for subsidies...So watch for that country in the next months...they need to just eliminate all those bureaucratic problems to get those things installed and you have another huge market with 300 MW annually....Though Greece's solar renewable targets are set quiet low as of now...but that will change as of next year...

It is quiet tough to see where we are going in 2009...But I have been working hard the last couple of days to get a good estimate for 2009(at least for Europe)...Still not through all the countries but it is looking nowhere as gloomy as expected...All this Spain hype is so grossly overdone IMO(As also the installed 1.1 GW for 2008...Maybe cumulative but certainly didn't install that much IMO but that is more of a guessing game at this point)...As I said I am not through but as of now I can imagine a growth rate of 20% just for EUROPE not the world...Ill let you know country by country what I expect in a couple of days if you are interested...With kind regards from Germany CW

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

Chinese Solar Stocks Present Compelling Value

I do agree with you their Rana the increased REV guidance was nice...the convert doesn't hurt too much since they did not "over do it"...but the margin does leave some room for concern...I expected it to actually be at the very minimum equal to the Q1 margin...And am sort of disappointed by that...Obviously the beat was nice....two times beating in a little more than a month...(since last Q numbers came out so late)Well we will have to wait for audited numbers/CC for more information concerning that...but certainly not bad news today....

@Jack I do agree with you that solely looking at federal tax incentives doesn't give you a clear picture...But still there are only a handful of states who provide incentives enough to get solar off the ground...I mean a considerable amount....Not the tiny amounts of today...and concerning Spain the incentive cut will be bigger than in Germany but that is no reason for concern....A problem would be a cap....But as I stated above i doubt a cap will come and if it does 750 MW is realistic, and not the 250 MW # that some analysts were throwing around...

And it's looking like my prediction from 6 months ago that Italy will be huge is slowly, but surely, coming true....especially in the South of Italy it can be used very well....Also Switzerland increased incentives this week and the package they proposed and implemented looks quiet decent(but it is a small country but every MW helps)....So i totally agree with you that incentives will increase rather than decrease globally but it is really time for y'all to step up to the plate...

It just cant be that the best idea, so far, is to drill in Alaska (if I understood correctly in a wildlife refuge)!!!!I mean that leaves me speechless....And makes me, to be honest, VERY angry...We all live on this planet together and y'all are doing your best to destroy it...First for years driving your huge SUV's, Air conditioning 24/7 everywhere, and your industry being quiet wasteful concerning fuels when they were cheap and that leads to the destruction of OUR planet...and then as if nothing was learned the best idea is to drill in Alaska....The point is that we have great opportunities and that is due to OUR incentives which got Solar, Wind,etc. off the ground...so please use the technologies that are only available because we subsidized them:)I guess i wasn't so speechless after all;)...With kind regards from Germany CW

PS and if we can "save" the planet and "all" earn a good amount of money while doing it lets go for it right!?!:)Sorry for the mix of politics, lifestyle, into a discussion about stocks but I do believe it is important to talk about these issues...and I am not looking to offend anyone as I lived in your country for a few years and quiet enjoyed my time their....But as I said these issues are important to talk about...though they don't really pertain when talking about stocks...

Chinese Solar Stocks Present Compelling Value

Dear Rana I have many friends at the EU commission for energy and I know a couple guys working for Wacker Chemie(one of the biggest, or the biggest I am not quiet sure, poly producers in the world) so please do not worry about my knowledge about poly contracts, but I do thank you very much for your concern:)

To Vitamin J indeed that comparison is a bit far fetched as I stated before...And I was having quiet the poor day and when i read your guys' comments...you know how it goes:)

@Eric Rulmat - I think you are absolutely right if you are looking for value(yes I said value in the same sentence as solar shares)/growth it is the right time to go for it...These companies trading at these ridiculous P/E ratios...

And they (analysts) say it is bad to invest in Solar because of Spain, and its potential introduction of a 250 MW cap....anyone making that assumption is clearly uninformed about Spain....If they do introduce a cap, which I doubt, it will be around 750 MW(Spains solar industry just simply won't let it happen and many other reasons for that matter)....what could happen is that they slash incentives by 20-30% which wouldn't hurt the Spanish market as much as one would expect(at least in Spain due to its perfect placing on the "solar map")....And the next boom market for solar is Italy which will be the next Spain....And Trina's positioning their is absolutely marvelous as you can see in the contracts signed in the past few weeks their...I think Trina and SPWR (due to the acquisition they made last year) have the best position in that rapidly expanding market....

I think it is quiet obvious...that companies that grow 100%(sometimes more, sometimes less) y-o-y need some money in order to finance their rapid expansion...Obviously they burn more money than they take in at the moment...How could you not with ramping of X amount of lines a year and investing in long-term poly contracts...expanding capacity in some cases three or four fold...(sometimes less but certainly not the point)...Alternative energies are there to stay....

The last advanced country that has to make the step is your guys' country(and your little/big brother the UK...depending how you look at it;))...And it is quiet shameful what is happening with renewables in the US....and I certainly love how everybody complains about Gas prices/Oil prices but nobody looks for solutions...the next "great" American plan is to drill in Alaska....that is the solution...is it really?Quiet impressive:)In any case we are not here to talk politics, otherwise I probably wouldn't stop typing in any case;)

To bring this long post to an end...As you stated the main point you were trying to make is that the companies in the solar industries are just hitting speed bumps...and that is certainly the case...Would I sell my shares because of that no way...Each day is another day shopping for solar shares at ridiculous valuations....The more the American public, and the world(besides the EU), gets involved and begins to grasp what Solar can do for us in the long term the greater will be our returns so enjoy because I do not know how many oppurtunities you will get buying shares at these prices(not saying it couldn't go down a bit more in this bear market but I think we are close to bottoming out)....Kind regards from Germany CW

PS @All....I do encourage you to read Jack Jetiv articles about the solar space I have been involved quiet some time...with plenty of different stocks...But both TSL and CSIQ were his picks(well he wrote some articles and I got more informed about them and tend to agree with him in most things)....With one working out quiet well the other one lagging...But IMO he has a great understanding for the industry....But also bigger companies besides the ones Jack mentioned are worth other looks....with SPWR(probably the best managed company in the whole solar space),LDK, STP...Please beware of FSLR everyone.....check out all the facts there are....Cheap doesn't mean good:)(certainly not meaning their valuation,but the cost of their inefficient panels when size of the area is constrained)

Long ABX, CSIQ, TSL (No shorts at the moment but if FSLR hits $300...)

Chinese Solar Stocks Present Compelling Value

If you guys havent already heard from the uninformed comments posted here...TSL has forward contracts in poly....which would lower their poly costs next year from 12-17%....what WFR will do no clue but that is not my point...

if you guys don't know what you are talking about concerning Trina's Poly positioning...I just wouldn't talk about it...So yeah Rana and Vitamin J do some research or just listen to the CC but thinking or doing some research before you talk is always a good idea:)kind regards from Germany CW

PS good article though some tough comparisons to make:)

Long ABX, CSIQ, TSL

The 'Problem' With Solar Companies is Not Really a Problem

Atticvs research - We have the $1.05 Non Silicon costs + 1.40 silicon costs (2.45) at the end of 2008...I expect that to drop to .85 N.S.C(You can actually move this number down quiet a lot depending on the learning curve)+ .70 silicon costs in 2010...That would put us at 1.55 production costs...The silicon costs are due to come down very sharply for two main reasons,1. The market will be swamped by silicon...I know a guy from Wacker Chemie...(German poly producer) and they expect the market to be swamped and thus opted for a big junk of forward contracts in the future...Also I expect the Grams/Watt used in Wafers to come down to about 4-5 g at least....Then you also have to model what energy prices will be like...That depends on what you believe...In any case this is an aggressive model and picture that I am painting...obviously you can tweak the numbers any way you want to...But I Believe ASP costs will be around 1.50 around that time...Which will put it an Grid Parity in all sunny regions at the very least....

And do not get me started on thin film....their are costs involved their that one does not realize I think the efficiency of the cells is much more important than the cost actually...Obviously not in the long term but the thin film advantage that FSLR has for example will be eaten up real quick because the biggest solar opportunity is on factories...or office buildings....for now....and their efficiency counts and not the cost I mean it is great that FSLR panels are so cheap but you need an abundance of land....then you need to get hooked up to network etc.,etc. So in the places space is a concern and that is just about everywhere especially in Europe it is important to go for efficiency...Where the density is unbelievably high...Otherwise you can use cheaper models....But FSLR is doomed anyhow...but that is for another day....I keep on hearing thus numbers thrown around that you mentioned how is supposed to reach them?Nanosolar...?!?Th... Chinese players are set up well for the future....At least when considering CSIQ,LDK,SOL,STP,TSL..... the only question is how will demand look like in 2009...That is the only year these stocks could get hurt bad....But IMO Spain will not introduce a cap at all...Why would they...They are reaching grid parity next year....They will reduce feed in tariffs about 20 percent and why shouldn't they....the demand will still be their...even with less subsidies...and don't forget that many American/Chinese players will have a huge exchange rate advantage...(With the American adv. bound to stay for awhile with that interest policy and Chinas exchange rate policy is well known...but I guess they will edge up on the Euro in medium to long-term)This will make it easier for these companies to compete...But basically what we need is an incentive package for the US and Spain will work out by itself people(banks) just want solars at cheaper prices....With kind regards from Germany and happy 4th of July...CW

The 'Problem' With Solar Companies is Not Really a Problem

Who cares about the analysts I live in Europe and I know what is going to happen next probably a cap of 1GW people throwing around numbers such as 300 MW for Spain it is utterly crazy why would spain do that?Their place on the solar map is excellent in actuality in Spain we will reach Grip parity next year...yes next year if we haven't already reached it....so incentives will come down surely but the demand for a cost cutting technology will not drop as much as the analysts say.....even if incentives are dropped 35%...the effects are much smaller especially for American solar makers or Chinese...due to a favorable exchange rate which will only get better due to FED policy....

Concerning cash flow...can't wait until the first solar companies present in that case SPWR..which has an a huge exchange rate advantage they will blow numbers away and raise guidance...again...To GS these people are criminals but banks need money too...I think in their case they should worry about themselves not being able to pay their debt(maybe not in GS's case)....In any case I am so long TSL look for 75 cents next Q....and an expanding margin in the second half of 2008 and they have 60% of their production pre-sold for 2009...(excluding the new contract with the Italian firm)...So that is a pretty stable outlook with a constant flow of cash income either GS didn't research well or want to kill the stock, my guess tends towards the latter...and by 2010 Grid parity will be reached by Trina...(obviously not in all geographic locations but in most)....and at that PE it is just sooooo cheap...well make a picture for yourself...in any case solar is the answer to a lot of problems now the US has to support it to increase the market(demand) for the solar makers...this is the greatest and cheapest opportunity to get into solar you will see for quiet a while...kind regards from Germany CW

A Missed Opportunity in Canadian Solar

I do have to, sort of, agree with "absurd"....I have my concerns that Trina Solar is going to make a big move before they report their next earnings...but on the other hand as I have been playing the sector for a few years and realized the perfect timing to buy these volatile stocks is nearly impossible...so who knows maybe 39 is a great price to buy or maybe it is 35...in any case Ill be continuing to pick up TSL because I cannot predict when the move will come, but what I have learned in Solar stocks if you believe in your stock you shouldn't care so much about big moves (up o. down) just try to stay as rational as possible....and TSL is certainly not expensive @39$, but rather than that, it is quiet cheap....

To CSIQ after reading some comments(for ex. zachs.com comments) I just want to clear some things up....they (CSIQ) raised revenue guidance from $650-750 mil. to 750-870...In Q1 they had revenues of $171.2 mil...and earned just about 19 million....which leaves at an operating margin of just 11%...Lets us just assume that margin stays equal(which it will not the margin of CSIQ will expand but lets just talk worst case scenario)...and we take 810 mil of revenues(also conservative IMO but that is in the eye of the beholder) then we would get an income of about (.111x810)$90 million mil....so the stocks is actually trading at around 14 times earnings at the moment....and not trading at forward earnings of x24...which would imply earnings of $54 million so I cannot really understand those calculations...

Also as Jack mentioned above, the market is really not looking too "hot" right now....So surely there is the possibility solars will correct even further...Anything can happen, especially with solars, but I am a firm believer in the sector and really like TSL, STP, CSIQ, SPWR(but a little cheaper would be nice in the case of SPWR especially).....With kind regards from Germany CW

Long ABX, CSIQ, NFLX, STP, TSL

PS What do you guys think about investing a little bit more downstream in the solar sector....For example AKNS?I mean at 170 million it has quiet the low market cap(just concerning the market cap since they don't earn money...)but their is some obvious issues....but has anybody have extensive knowledge about AKNS and its future....would be much appreciated....

Further Thoughts on Trina Solar and the Solar Space

@Jack....Well for Germany we are on Target to reach around 2012 probably....earliest i could possibly imagine is 2010-2011....For Spain it is a hard measurement but I think they might actually reach their goal around the same time....thanks to better placement on the sun map...on the other hand Germany is heavily investing in Wind as well, Nordex, RePower Systems, and Vestas (danish), are good plays but I like solar better...I Also think they will far exceed those goals at the latest when Grid Parity is reached(I know you believe it is already reached but I mean when incentives do not drive demand anymore...in a couple years in most countries....).

But could you, or anybody else, clear up for me how much they(TSL) are planning on selling to the US I still have that question mark in my notes....Concerning China, and India actually, the greatest opportunity is in the rural areas but I think that will take a couple years to develop demand their....though the "global" cities Shanghai, Beijing etc. could certainly use some energies that are not so polluting if you take the air pollution into consideration it is like constantly smoking a cigarette...without the nicotine;)With kind regards CW