Solar Stocks Surge On Canadian Solar Outlook, German Clarity
Canadian Solar’s (CSIQ) outlook is helping the Chinese solar segment on Wednesday, despite missing on EPS.
Canadian Solar, which conducts all of its manufacturing operations in China, saw its revenues more than quadruple year-over-year in the fourth quarter to a record $287 million – easily beating analyst consensus of $267 million, according to Reuters. The company missed on EPS, which came in at 35 cents versus estimates of 45 cents, but investors are paying closer attention to the company’s 2010 outlook, amid a wave of demand worries from industry analysts.
In a statement, Canadian Solar CEO Dr. Shawn Qu said, “Demand is expected to be very strong for all of 2010.” The company reiterated its full-year 2010 shipment guidance of between 600MW and 700 MW. Today shares are ahead by 3%.
As a whole, the Chinese Solar Stocks Index is up by 4% today on optimism from Canadian Solar, as well as some clarity on subsidy cuts from Germany.
According to Bloomberg, Chancellor Angela Merkel’s cabinet agreed to cut solar subsidies by -16% for rooftop systems, and by -15% for solar parks starting July 1. German subsidy cuts have been expected for some time now, but stocks swung wildly as various drafts of the plan adjusted the degree to which incentives would be reduced and the date the cuts would take effect.
Yingli Green Energy (YGE) is among the Chinese solar sector’s top performers today after announcing a new U.S. deal Tuesday morning. According to the press release, Yingli will supply New Jersey-based SunDurance Energy with more than 10MW of photovoltaic panels through the third quarter of 2010.
Meanwhile, Trina Solar (TSL), ReneSola (SOL), and JA Solar (JASO) are all jockeying for the segment’s top spot, up by over 4%. Yingli, Trina, and Solarfun Power Holdings (SOLF) have now added more than 10% over the last week.
As of this writing, the Chinese Solar Stocks Index and the broader Solar Stocks Index both remain among the ten worst performing tickerspy Indexes over the last month. It will be interesting to see whether these stocks can get some traction now that investors can finally model around the German incentive cuts.
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