Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Some chinese solar companies (JKS, TSL, CSIQ, SOL, JASO, DQ) $ per watt produced comparison with spot prices

|Includes: CSIQ, JinkoSolar Holding Co., Ltd. (JKS), TSL

The premise of this article is that from companies with business focus on one part of the solar segment (wafer or module etc) one can easily come to a $ per watt price of the production they have. This ofcourse will only be a rough estimate incase they also have a revenue from other segments that skew the total revenue. In any case it shows what kind of prices the company is getting for the production they have.


Company Ticker Revenue (in millions) Net income (million) Margin income MW sold Business focus Dollar per Watt
Jinko Solar Jks 326,70 51,4 15,73 % 208,4 Modules 1,57
Renesola Sol 328,15 43,3 13,20 % 330,4 Wafers 0,99
Ja Solar Jaso 556,38 71,8 12,90 % 451 Cell 1,23
Trina Tsl 550,85 47,65 8,65 % 320 Modules 1,72
Canadian Solar CSIQ 443,404
5,877
1,33 % 244 Modules 1,82
          Tonn sold   Dollar per T
Daqo
DQ 87,311 34,995 40,08 % 1097 Polysilicon 79,59

It seems some companies are getting cash for each watt of production than others. Lets compare this with spot prices from pvinsight.com and see how much they are off/on to those. This will only be done for modules and polysilicon as there are too many product types of wafers and cells with different price spots. Spot prices of one kg of polysilicon is on average 74.5$,  abd for modules its 1.42 $.

Company

Dollar per Watt

Compared with spot prices

Gross margin

cost of production to
 company excluding overhead

earned per watt (without overhead)

Jinko Solar

1,57

110,40 %

26,20 %

1,16

0,41

Renesola

0,99

cant calculate

30,70 %

0,69

0,30

Ja Solar

1,23

cant calculate

17,30 %

1,02

0,21

Trina

1,72

121,23 %

27,50 %

1,25

0,47

Canadian Solar

1,82

127,97 %

14,70 %

1,55

0,27

 

Dollar
per Tonn

 

 

 

 

Daqo

79,59

106,83 %

51,00 %

39,00

40,59

 

Dollar per watt reveals what kind of revenue the companies are getting for each watt produced. Bear in mind this number is for all different types of products so its an average giving an indication on what type of sale prices the companies can generate for the products they have.

CSIQ sells 28% above spot prices, TSL 21% above spot prices and JKS 10% above spot prices and Daqo 6,83% above spot prices. But ofcourse getting good sale prices is not the whole part of the story. You better produce them at reasonable prices too. JKS has the clear lead here producing each watt of sales for 1,16$ of production equipment and material while TSL is in second place and CSIQ is in third. I would say then JKS has the most potential to earn in the future if it can get better sale prices and brand awarness. Finaly lets look at who actually gets the most $ left after each watt produced and deducted for materials and equipment use costs. Clearly Trine solar is earning most on each watt they produce with 47 cents generated for each watt produced, while Jinkosolar is not far behind at 41 cents per watt produced. Canadian solar only generates 27 cents for each watt produced.


Comments: Ofcourse the better your selling terms are the better the company health is there and then, but your internal cost and also future potential should allways be investigated. It seems out of the companies investigated in this blog JKS has the most potential as it has the lowest sell prices but allmost the same production costs as the leader. While canadian solar looks good on paper it has very high sale prices, if these should drop it will be in big trouble with its allready low generation of cash per produced watt.

sources:

http://solarpvinvestor.com/2011-global-q1.html
Jinkosolar q1: phx.corporate-ir.net/phoenix.zhtml?c=234...=
Renesola q1:ir.renesola.com/phoenix.zhtml?c=210622&a...=
Ja solar q1: investors.jasolar.com/phoenix.zhtml?c=20...=
Trine solar q1: phx.corporate-ir.net/phoenix.zhtml?c=206...=
Canadian solar q1: phx.corporate-ir.net/phoenix.zhtml?c=196...=
Daqo q1:ir.dqsolar.com/phoenix.zhtml?c=234265&am...=