225 replies to this topic

[eysteinh]

Np just matter of oppinion. with 70 % modules and 690 MW with 30% cell at 0.44 (207 MW) and 483 MW at 0.67 that should be 415 mil revenue and 18 % gm 74,7 mil gross and 44,4 mil opex/interest  and some 5 mil currency/tax= 25,3 mil Assuming 58 mil shares thats 0,43 diluted. They are not passing in Q2 is not what I said but they are passing over time if current trend is continuing of jaso increasing per quarter while cisq zig sag up and down quarter to quarter depending on when projects are completed and some might be pushed into 2015. Trend so far is pretty clear but will be interesting to watch. Anyhow even if jaso does not pass csiq mcap is much less.  Same with JKS. 

[explo]

I'm surprised this is not included. Without it, my EPS estimate would have been 0.09. The core business had done a bit better than I thought. The main differences aside from CB accounting  from my estimate are:

 

(1) Lower G&A, diff of $4.3M

(2) Higher interest expense, diff of $2M

(3) Higher FX loss (including deriv hedging), diff of $2.5M

(4) Higher tax expense, diff of $4M

 

(1) is positive and the other 3 are negative factors to the EPS. The real positive from ER is that their Q2 guidance is much better than I thought, in fact, will be better than 13Q4. And they have reaffirmed their 2014 guidance. The best of all, Dr. Qu expects China to install at least 11-12 GW, possibly 14 GW. So over all, I think this is a great report.

 

Going forward, they still need to manage FX better.

 

Thanks. Yes Q2 guidance expectation were massive on my side and its good that they delivered there. I wonder if JKS will account differently (condsidering PPS change effect on convertible value like they do with their 2011 CB)?

[eysteinh]

BTW CC us ongoing now for those who want to listen.

[odyd]

Np just matter of oppinion. with 70 % modules and 690 MW with 30% cell at 0.44 (207 MW) and 483 MW at 0.67 that should be 415 mil revenue and 18 % gm 74,7 mil gross and 44,4 mil opex/interest  and some 5 mil currency/tax= 25,3 mil Assuming 58 mil shares thats 0,43 diluted. They are not passing in Q2 is not what I said but they are passing over time if current trend is continuing of jaso increasing per quarter while cisq zig sag up and down quarter to quarter depending on when projects are completed and some might be pushed into 2015. Trend so far is pretty clear but will be interesting to watch. Anyhow even if jaso does not pass csiq mcap is much less.  Same with JKS. 

They have already quoted for lower GM, let's keep it factual.

[eysteinh]

They only said they expected a lower gm due to more shipments in china. If they do a project sale this can change. They gave no official guidance in the financial statement. Also they said "However, we do expect a gross margin expansion in the second half of the year especially from Q2 basis. We will focus more on the revenue and the bottom line improvement in gross margin remains a challenge."  You may also note they even in the end of the cc noted demand might increase end of may (so still inside q2.)  However I agree to keep it factual and a gm increase might be too optimistic on my front so I will pull back that emotional reaction of me on JASO. But I think the point still stands, JASO is catching up compared with mcap. 

[explo]

I hope I do not offend anyone but I think jaso is passing csiq now in profitability going forward. Even including the fact there will be more projects from csiq end of 2014. They still need cheap modules to make those projects a reality in lower fit/subsidy environment. And if competitors can make modules/systems cheaper they will be forced to do the same. Jaso is my favorite behind JKS. and I understand your reasoning as well explo so it might be that in the end it would be opposite (jaso better value than jks) but I strongly believe JKS will make profit defending the higher mcap than Jaso. 

 

If i should give a very rough comment it is JASO: Higher tech slightly higher cost. Should do well in BoS and systems. Stronger BS. JKS: Slightly lower cost, slightly behind JASO in tech. Slightly worse BS, more income and a much bigger project park already built and superior BOS (they got 1,2$/watt already in projects so that is very impressive.)  CSIQ: Slightly behind in bos and system, slightly behind in module tech, medium strenght bs. Strong financials and strongest pipeline. Should convert into more value giving a higher mcap long term. 

 

Anyhow let me add on a positive note my ending that CSIQ still has a huge pipeline, and just converting this should make them have a higher mcap than currently. Did we see a lot of weakness in csiq q1 report? Not really if we look at guidance. Still strong guidance and reaffirming whole year guidance. 

 

Thanks for your view. JKS is still my favourite company, but compared to JASO and TSL I think the market in 2014 might punish them more for their build and hold strategy and for running up faster than e.g. JASO in 2013. This is not fair nor logical (but is a short-term market risk), since I think that the build and hold strategy creates more value over time, but the short-term effect (and the market might think more short-term than we) is lower EPS reported and more stretching of BS than JASO and TSL will report. One good thing about JKS is that after the equity and CB issue in Q1 their BS will be much stronger, so the business on fumes argument should soon go away.

 

I'm adding DQ to my list of investable companies but think that JASO, JKS and TSL are the hot pick targets of those right now.

[odyd]

 I am saying they expect lower GM in Q2. CSIQ expects increase. JASO is not catching up with anything. It is trading at more than $2 prior to consolidation. CSIQ market cap is being dropped as the stock is being sold off for past tense events. My concern is that EPS is not going to be as robust as I thought it would be, which clouds expectations on PT. I was hoping for more than $4 in fact closer to $5. This is half in my view now, but I am being very conservative. Market is seeing the stock for this year with less PE than 10, even on my very conservative view. The hand has been played now it is analyst's take on it. If someone drops the PT, we are deep diving again, but we already being kicked in the groin this morning.

[eysteinh]

I agree explo. DQ is looking interesting now. If I can get some confirmation on what equipment they are using so I am more confident in theyre price target I would buy. 

[eysteinh]

 I am saying they expect lower GM in Q2. CSIQ expects increase. JASO is not catching up with anything. It is trading at more than $2 prior to consolidation. CSIQ market cap is being dropped as the stock is being sold off for past tense events. My concern is that EPS is not going to be as robust as I thought it would be, which clouds expectations on PT. I was hoping for more than $4 in fact closer to $5. This is half in my view, but I am being very conservative. 

Yeah your right Odyd. GM will be lower in q2 and it is wrong of me to assume it will be better. I retract that statement. (to be honest I remembered wrong from the cc it was after Q2 they saw increased margins. Keep in mind I have been studying extremly hard last two weeks with little sleep for exams so everything I currently say has a higher risk of fault heh.) But I do think jaso is catching up in earnings compared with csiq.  Both are good value (but jaso is like 1/3 mcap of csiq so if they can just have 1/3 net profit of CSIQ they are the same.)  I think module asp will influence project asp as well so we might see some project pushed back as csiq needs to keep project gm high. But that is just speculation from my part. What is not speculation is that csiq is doing projects in 2014 and will print higher eps in whole year. So do not mistake my statment that jaso is catching up to mean there is no value in csiq. There is for sure. Especially given the market irrationale today. 

[Scsnospam]

From cc - their guidance is not dependant on China DG policy etc. Guidance is based on mostly non-China destinations. So if policy does change, that would be a big upside, in my opinion. They handled that question well. That could be the upside for you, Odyd.

[explo]

but jaso is like 1/3 mcap of csiq

 

And much better BS. I would say that the market is pricing CSIQ 4 times higher than JASO when considering BS. So although I think CSIQ value is higher the question I asked myself was if it was 4 times higher. Watching the trend I feel comfortable with JASO investment. The downstream momentum of CSIQ and JKS in 2013H2 might be experienced by TSL and JASO in 2014H2, on top of already doing well in the module business.

 

JASO and TSL will be like the combo of CSIQ and JKS. Build and sell project business and profitable module business. JKS will still be leader of module business and build and hold project business and CSIQ leader of global build and sell project business, but we got a couple of new cheap kids on that block now that might attract the market attention given to JKS and CSIQ last year. Looking just at the 2 leaders I think JKS looks much cheaper than CSIQ.

[eysteinh]

That by the way is the reasons  i prefer jks over jaso. I expect EPS to be more than 50% than jaso can do, while mcap is less than 50% higher than jaso. So I asked the same question but got the answer yes it had more earnings to defend a higher value. And in a lower asp they are less vulnerable to kneel over. However I agree with your statment that JASO and TSL will get more attention. I think you have much better trade and market understanding than me. I just simply find best value and hold. 

 

Anyhow back to csiq q1: I think I have to check more carefull the cc and see how the projects are moving along before I conclude more. Wish nanofrogfish could comment on that. 

[odyd]

DG is something, which I believe was heavily advertised by JKS. This why I think speculators consider when short selling the name in the last couple of days. If we get the same CB execution, which is a recording the CB at face value and adjusting in the next quarter, we could be in the $0.45 cent range for EPS. Add a GM reduction to boot and we have another slaughter ahead. It is clear that this market is becoming completely dedicated to flooring solar stocks than embracing them.

[eysteinh]

Thats the thing - market is incredible irrational if they do that. So in the weak quarter they produce 0.45. Assume a weak quarter each quarter that is 1.8 per share. Historic P/E of JKS is like 23... (look at sites like barrons.) Even we assume P/E 10 the downside is very small now at 23$/share and at most a fall to 18$. And do I think they will print 0.45 every quarter going forward? No way. They are adding more and more projects increasing income every quarter even if everything else remained the same or even worse prices they can compensate with retainge that will increase and project income that will increase. Since I expect roughly 4$/share the outcome for me is obvious. And I think the issue on hong kong/ us stock exchange for projects during q4/q1 2015 will take everyone by suprise how it will realize value. 

[explo]

That by the way is the reasons i prefer jks over jaso. I expect EPS to be more than 50% than jaso can do, while mcap is less than 50% higher than jaso. So I asked the same question but got the answer yes it had more earnings to defend a higher value.

 

I agree on that Jinko produces best EPS per PPS. I weigh in cash flow generation and current state of BS when I conclude that JASO can be cheaper than a peer even if PE is higher than that peer. For me right now I see the same investment opportunity in JASO, TSL and JKS, so current pick is more of a short-term market timing based on current momentum (JASO is in the zone of major fundamental improvement now and has not had its PPS run).

[eysteinh]

And as I have said you probably have a much better market understanding than me. But I do not pretend to know what market will do from day to day, I simply pick most value that I am confident will realize that value going forward at some point. I was asked if I wanted to start a fund in Norway but turned down the offer saying I needed someone to do the trading for me as I only know to pick value, not timing to pick it. (I do not even want to know trading as for me its a pseudo science and only works because everyone agree it will work. At best it is correlations, and correlations are filled with 3rd variable problems.) 

[odyd]

I am presenting an observation. It looks like anything reported as "lower" sounds as a good reason to sell, instead of anything in the future being "better" as a reason to buy.

JA did better, did not even get a lift, but it has been saved from the carnage thus far. I guess not losing as much money is always better than losing more, so JA seems as a sound investment. When it comes to the future the lift, as it will come, it may not give as much attention to JASO.

I sold my JKS and bought neutral to indifferently painted TSL. However sometime after ccs are done and having deep look into CEDR, I will reassess everything over again. The extreme approach by the market may put JKS and CSIQ back in the dynamic category soon. I agree with explo that JA and TSL could very quickly be seen as appreciation opportunity in comparison to sorting our CSIQ and JKS evaluation.

Time certainly will tell.  

[explo]

And as I have said you probably have a much better market understanding than me. But I do not pretend to know what market will do from day to day, I simply pick most value that I am confident will realize that value going forward at some point. I was asked if I wanted to start a fund in Norway but turned down the offer saying I needed someone to do the trading for me as I only know to pick value, not timing to pick it. 

 

I did that for much of last year too, i.e. held JKS only and though it paid off in total it was not without stress, lol. That stock moves up and down wilder than the other CN4s. The laggard tactic is by the way also to handle risk of the high flying general market. We've seen that some solars (JKS) for no other reason than big gains in 2013 is dragged down when market is selling off actual Nasdaq high flyers (high PS companies).

 

I could as well be in JKS or TSL by now and will likely move to a mix shortly. For the long haul JKS is still my no 1 pick, but much of the value I see in its strategy over peers will not be evident to the market until next decade so I adapt a bit to the impatient and irrational market.

[JulyWebb]

Yeah maybe they'll just let JA stay a $2.00 stock forever and ignore all the improvements the Company made and the 2 Q's of profits but I really doubt it. I think with any stock WS must get in first especially with CN Solars before they can go anywhere. 

[saush11]

I could as well be in JKS or TSL by now and will likely move to a mix shortly.

Why ? To avoid concentration risk ? Otherwise, at 50% of Book Value, it provides the best risk/reward ratio ?