Entering text into the input field will update the search result below

ReneSola Ltd.: Dark Valuation

Mar. 01, 2021 10:14 AM ETEmeren Group Ltd (SOL)17 Comments


  • ReneSola’s price has jumped from a low of about $4 to a high of $33.5 in a space of just 3 months.
  • About 80% of the company’s humungous common stock worth $547 million has been eroded by its accumulated deficit.
  • The company’s revenues and profits are just too insignificant compared to its large equity capital. Moreover, the competition is intensifying.
  • I do much more than just articles at The Lead-Lag Report: Members get access to model portfolios, regular updates, a chat room, and more. Get started today »

Hype comes with an expiration date, especially in a volatile stock market. Renewable power stocks, especially those belonging to the solar gang, have been zipping ever since the Democrats won the elections and the Biden administration announced its plans of making our country a 100% clean energy economy (0% net-zero emissions) by 2050.

Take the example of ReneSola Ltd (NYSE:SOL). The stock was languishing around $4 in early November 2020, and by January 22, 2021, it had moved to a high of $33.5. It has reacted sharply since and is quoting at about $15 as of February 25, 2021, a price that is about 900% of what it used to be a year ago.

Let’s face it − SOL’s price gains are unrealistic and purely based on the hype and news surrounding the solar power sector. It’s time for the stock to walk the talk and prove that its valuations justify its market price.

So, are SOL’s fundamentals sound? Let’s find out:



Image Source: SOL’s Income Statements

As per the latest data, SOL’s revenues of $9.7 million for the quarter ended September 2020 were a pale shadow compared to the $26.2 million revenues it generated in the previous quarter, which represented a period in which businesses were severely impacted by COVID-19. Its cash flows, quarter over quarter, are too negligible to even analyze. In the quarter ended September 2020, SOL generated -$1.9 million in operating cash flows compared to operating cash flows of $5.4 million in the quarter ended June 2020 and -$9.9 million in the quarter ended March 2020.

The numbers are too inconsequential when you consider SOL’s equity dilution and accumulated deficits:


Image Source: SOL’s Balance Sheet

About 80% of SOL’s common stock of $547 million has been wiped out by its accumulated deficit of $442 million. While the company’s accumulated

Anticipate Crashes, Corrections, and Bear Markets

Sometimes, you might not realize your biggest portfolio risks until it’s too late.

That’s why it’s important to pay attention to the right market data, analysis, and insights on a daily basis. Being a passive investor puts you at unnecessary risk. When you stay informed on key signals and indicators, you'll take control of your financial future.

My award-winning market research gives you everything you need to know each day, so you can be ready to act when it matters most.

Click here to gain access and try the Lead-Lag Report FREE for 14 days.

This article was written by

Michael A. Gayed, CFA profile picture
Anticipate Corrections and Volatility with Award Winning Research
5x Dow & Founders Award Winner. Risk-On/Off $RORO, Junk-On/Off $JOJO, & $ATACX Portfolio Manager. Anticipate Crashes, Corrections, & Bear Markets With The Lead-Lag Report. Sign Up For 2 Weeks Free.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

This writing is for informational purposes only and Lead-Lag Publishing, LLC undertakes no obligation to update this article even if the opinions expressed change. It does not constitute an offer to sell, a solicitation to buy, or a recommendation regarding any securities transaction. It also does not offer to provide advisory or other services in any jurisdiction. The information contained in this writing should not be construed as financial or investment advice on any subject matter. Lead-Lag Publishing, LLC expressly disclaims all liability in respect to actions taken based on any or all of the information on this writing.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.