Earnings Preview: LDK Solar Co.

| About: LDK Solar (LDK)

Company Profile

LDK Solar Co., Ltd., together with its subsidiaries, engages in the design, development, manufacture, and marketing of photovoltaic (PV) products; and development of power plant projects.

LDK Solar (NYSE:LDK) is scheduled to report its first quarter earnings results on June 26, 2012, before market open.

Technical Overview

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LDK Solar has a market cap of $276.39 million and it is currently trading around $2.07 with a 52 week range of $1.54 to $7.52. The stock has fallen 50.6% year to date. The following table provides the key financial ratios for LDK Solar:

Key Ratio Value
Current Ratio


Profit Margin -28.22%
Return On Assets (ROA) -1.74%
Return On Equity (ROE) -65.33%

Recent News

  • On June 15, 2012, LDK Solar together with its partner Solarif, a fully mandated underwriter of HDI Gerling for PV insurance, are the first companies to introduce a unique insurance solution at the system level. LDK Solar Secure provides customers with a complete insurance package combining an operational 'All Risk Insurance' with a warranty and inherent defect insurance. It includes a full backup of LDK Solar Product and Power Warranties on PV modules.
  • On June 14, 2012, LDK Solar introduced its innovative product offering to the global solar markets at Intersolar Europe, the world's largest exhibition for the solar industry in Munich from the 13th - 15th of June.
  • On June 4, 2012, LDK Solar announced that the company has signed three multi-year engineering, procurement, and construction (NYSE:EPC) agreements. All three projects are located in the Gansu province of the People's Republic of China.
  • On May 24, 2012, LDK Solar responded to US Department of Commerce's preliminary decision on antidumping tariffs for Chinese sSolar cells and modules - LDK Solar has been a leader in the highly-competitive global solar industry since the company's founding in 2005, and this decision will not change LDK's strategy in developing markets worldwide.

Here's a list of recent changes to analyst ratings:

  • On May 28, 2012, Thomson Reuters/Verus upgraded LDK Solar from SELL to HOLD.
  • On May 14, 2012, Thomson Reuters/Verus downgraded LDK Solar from HOLD to SELL.
  • On May 8, 2012, Thomson Reuters/Verus resumed coverage for LDK Solar with a HOLD recommendation.
  • On May 5, 2012, Columbine Capital Services, Inc. downgraded LDK Solar from NEUTRAL to UNFAVORABLE.
  • On May 4, 2012, Ativo Research downgraded LDK Solar from NEUTRAL to MOST UNFAVORABLE.
  • On May 3, 2012, Zacks Investment Research, Inc. downgraded LDK Solar from HOLD to SELL.
  • On May 1, 2012, Auriga downgraded LDK Solar from HOLD to SEL and lowered the price target from $3 to $2.

Analyst Guidance and Earnings History

The first quarter revenues are expected to be $225.47 million when compared to $766.34 million for the same quarter last year. Earnings per share for the first quarter are expected to be loss of 114 cents a share, down from a 95 cents a share in the year-ago period.

The average price target from analyst for LDK Solar is $2.44 with average rating is UNDERWEIGHT

Out of the last 4 quarters, LDK Solar has met or exceeded the EPS estimates only once. The following chart shows the Analyst estimates history and the actual EPS results:

The following chart shows the annual summary of Sales and Net income for LDK Solar:


YINGLI GREEN ENERGY (NYSE:YGE), SUNTECH POWER (NYSE:STP),TRINA SOLAR (NYSE:TSL) and FIRST SOLAR (NASDAQ:FSLR) are considered as major competitors for LDK Solar and the table below provides the key metrics for these companies:

Price $2.07 $2.90 $2.06 $6.68 $15.23
Year-To-Date Price -67.46% -62.97% -74.13% -63.69% -88.10%
Market Capitalization $295.1M $443.1M $364.1M $537.9M $1.3B
Earnings per Share -4.9 -3.96 -6.5 -1.63 -7.03
Total Revenue $2.2B $2.3B $2.7B $1.8B $2.7B
Employees (Full-Time) 24449 16054 17693 7891 7000

Sources: Some of the data is taken from Google Finance, Nasdaq, Yahoo Finance, Finviz and investor sites.

Disclaimer: I am not a registered investment advisor and do not provide specific investment advice. The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities. Before buying or selling any stock you should do your own research and reach your own conclusion. It is up to investors to make the correct decision after necessary research.

Additional Disclosure: I change my positions very frequently and may initiate either long or short positions in the above mentioned stocks at any time.

Disclosure: I have no positions in any stocks mentioned, but may initiate a short position in LDK over the next 72 hours.

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Tagged: , Semiconductor - Broad Line, China, Earnings
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