Garry

China: The One Global Market with Gains Behind the Gloom

No comment on why the slowdown, nor what will be the inflection point. What will turn the growth rate rate positive? If the growth rate rate doesn't turn positive or at least flatten out, how do we know that the materials demand will increase? Do they already have the stuff needed for the slower growth? Was the true growth much lower and now they have too much material? Will 2010 growth be 5%? If the growth is still so strong, how do we explain the lowered -much lowered- commodities prices? What of the lower electricity usage in China? Is the government going to turn green and prevent China industry from polluting the continent? What of the Baltic Index ? What of the stories that mines are shutting down, coal demand is off, and shipping is dramatically down?

This article is good news. I hope he's right.

Trading Obama: Solar Stocks, GM Debt, Ambac Calls, Lorillard and Goldman Puts

Somewhat encouraging article, but didn't speak to solar's risks: huge venture capital infusion up to mid '08. No barriers to entry so margins are very thin and new players. Any price erosion with already thin margins can drive the PE up while the stock price goes down. ALso, Sharp wants 50% of market. They don't show up on the screen since they're so diversified.

All that said, this could be a great opportunity to enter the solar market. Historic lows.Companies mentioned have some presence and may survive, even prosper. Quarter reports due later this month on TSL CSIQ. Last qtr was great, stocks still got killed.

More Downside Ahead for Solar - Barclay's

Last I heard from CSIQ, their book to bill was at record. They had a good qtr, and they report later this month. I expect them to have a good qtr, good forecast and maybe the stock will still get hammered. But I think that they could have a great future beyond the immediate qtr. They should do well. We still disagree about Eric, I still see positive articles from him and I feel he is only reporting the news, not making it up. What about the analysts who change their "BUY" rating, when the stock is high, to a sell when the stock is off 60%? They should be out of a job. They are supposed to predict the future, not report the past.


On Nov 05 11:09 AM TimboM wrote:

> @Garry - I disagree about Eric. He is consistently biased toward
> negative news. Have a deep look at how he covers Apple. If you didn't
> look at their financial situation and just read his reporting, you
> would think that they are circling the drain. This is a company that
> has built a cash hoard of $24.5 billion and that had non-GAAP revenue
> of more than $11 billion in the fiscal Q3. And that's not even their
> biggest quarter of the year - we're in it right now.
>
> I also could be mistaken but I think that he added the last sentence
> after the article was originally posted.
>
> My specific comments about this coverage of the solar industry have
> to do with the outlook. I'm not familiar with every stock, but can
> anyone please give me a decent reason why I shouldn't feel bullish
> about CSIQ for instance? I have looked at their financials and can't
> see a reason why they would not be a reasonable investment.

More Downside Ahead for Solar - Barclay's

Shouldn't pick on Eric. He's only reporting the news. And a good job he does. Thanks Eric.

Sure seems like this forecast should have been offered at the end of August, not now. I'd like to see the actual analysis that is the basis for the opinion. It seems to me that the money's made when blood is in the streets. Like now.

Seems to me this analysis is almost as bad, not quite, as GS. They put out their sale at almost the exact bottom -so far.

Jack, good to hear from you again. I'm looking forward to your comments at the end of Nov.

Solar Investment: Epic Correction Leads to Depressed Sector with Plenty of Potential

Nice article. It's nice to hear this from someone with your credentials. And it does seem to me that the GS types recommend a sector and company with a buy rating, see the stock fall 65%, and then change to a sell. So who should be listening to Goldman Sachs anyway? I would ask however, if the market softens a little, it seems like the narrow margins the solars earn could have a sharp impact on the "E" of the P/E, and drive the earnings to zero or worse. Any comment on that?

It also seems like now is the time to invest in the solar space, rather than when all is rosy. Any comments Mark?

Some Stocks to Research for the Market Rebound

I'll take a crack at GS. How can they have a buy out on the solar space, see the solar's take a 60% hit, be involved in the credit crunch responsible for much of the macro mess, and then change to a sell? Doesn't the sell make their previous "recommendation" look pretty bad? Aren't they admitting that their previous recommendation was exactly backwards? Why would anyone want to listen to them now? Aren't they supposed to put the macro environment together with the solar specifics and extrapolate into the future? Why is that guy still employed? How wrong to do you have to be before you're out on the curb? Aren't the stocks more compelling now at a 60% haircut than they were before they lost the 60%? And in the mean time, they've had blowout quarters.

Seems to me he's got it exactly wrong again. Long term, some of the solars will not make it. As with many high growth young industries, new technologies, new competition and market proclivities will hurt some and benefit others. But the solar space seems promising, and many companies are nearly sold out for '09. Seems also that the demand for solar won't go away unless the right guys admits global warming is a hoax. I'm not looking for that to happen.

36 Opportunities for the Beginning of the Bull

Good information Bill. You acknowledge the poor factory orders and unemployment, but you don't explain how those numbers factor into your forecast. Please post.
Thanks

Corning Retains Strong Balance Sheet & Market Position Despite Earnings Warning

What about plasma TVs? GLW doesn't do plasma, do they? Lots of cheap competition for laptop glass, what's the future for LCD TV?

Don't forget the high def mandate may force consumers to buy new TVs. LCD or plasma?

Why Don't Earnings Matter Anymore?

Thanks, Trader Mark. Appreciate the info. I'm very surprised that coal companies trade at such discount. And fertilizer companies growing that fast. Sometimes you can dig in and find reasons why the PE is so low, like 1 time earnings boost, or future looking dimmer than the past.

CAT, BUCY also trading in the single digit PE (forward).

What do you think about sector rotation? What's it time for? Heavy equipment made it thru the first half, only to suffer their own hit last few weeks.
Thanks again Trader.

What's Up with the China Solar Stocks

Thanks for the article Eric.

I don't buy the excuses given, but I don't have any of my own to offer. There are a lot of great companies trading at huge discounts with very bright futures. Solar seems to be an industry with that characteristic. We could have a good bull market coming up if we quit telling ourselves how bad things are. All this gloom is becoming a self fulfilling prophecy. We put a terrible spin on the good news and over state the bad news. Intel said it in their cc, something to the effect that they saw good customer demand, but they also watched cnn, implying that the news was different than their business.

Check out "money and investing", Ken Fisher's website or Briefing.com. They speak to the much better economy than the MSM will print. Look at the negative slant in the MSM to even good news.

Trina Solar: Will 2009 Be a Breakout Year?

Nice to hear your comments, Jack.

Seems like many/most of the solars are making numbers and forecasting great qtrs ahead. Seems like something funny that everyone's doing that well. Can the future really be that good?
Maybe in the short term.

What company can grow 50-100% annually, producing their own product, and not need capital? Shouldn't it be expected that companies will take on more debt? Need more infrastructure? The worry for CSIQ and TSL seems to be their '09 debt needs. Let's hope they need more debt...

Can someone offer a reason why STP reports and the whole segment rallys? CSIQ, TSL and others report excellent qtrs and sag afterward.
Confidence in pricing going forward?

MEMC Electronic: Glass Half Empty or Half Full?

Good post. I was looking at them several months ago and their financial ratios were too rich. Now looks like a good entry point. However, AMAT is selling equipment to open competition. Solar is still a new industry and could have major disruption with new technology, WRF could face new competition going forward. What barrier to entry is there? Poly's prices are supposed to drop, making margins harder to maintain.

I do question whether the two problems completely explain the shortfall. But their huge cash reserve, large ROE do give some measure of management's ability.

MEMC Electronic Materials: Too Cheap To Ignore?

Nice job, Eric,
Convergence of problems today, maybe contributing to the price drop. A few points to wonder about:
poly customers claim price drops in poly going forward
are the factory problems really to blame for the shortfall?
WFR rich in cash, $5.64 / share w/ nearly 0 debt
strong ROE,
Stock price dropped $10 in the last month before today.
A little odd that solar companies are heavy in debt CSIQ, STP,TSL,others,, and going further into debt when WFR has so much cash.

What were the analysts saying when the stock was $80-$90 a few months ago?

Canadian Solar: Opportunity in Multiple Contraction from Dilution

Tough times for the present. If the forecast holds, or even close, the stock should rebound. I think they shoulda picked a different debt method. But if they hold to their forecast, they'll do well.

Canadian Solar: Opportunity in Multiple Contraction from Dilution

Jeffrey, times are tough. I'm thinking that the offering will have to go a lot lower, won't sell at $35. Woulda thought they'd gotten additional debt somehow, maybe now they'll change their debt method. Either way, tough short term. I'm thinking they were too optimisitic that the market would go for it. Long term, they should do well, assuming their sales hold. Don't agree with Envoy, I believe they are profitable -just cash flow poor. Spain shouldn't be a big hit to their forcast.