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Showing content with the highest reputation since 07/23/2013 in all areas

  1. 5 points
    Having purchased CEDR since the start I have now acquired 2 full years of data. This makes trend analysis a meaningful and fun exercise. I did a trailing twelve months (TTM) trend analysis of CN9 that I'd like to share with the club (as always odyd, feel free to delete it if you think it is excessive exposure of data). Each month in the attached chart represents the sum of monthly exports the past 12 months. By using 12 month compounded exports the seasonality effect is eliminated from the trend lines and the trendlines should thus reflect pure competive strength trend on the global market. It's quite clear that the "investable" CN4 have had a strong trend in the global market share competition. It is also clear that financially stressed Suntech and China Sunergy lost a lot with their hands financially tied. Also significantly financially stressed Yingli with nose just above water (unlike Suntech and CSUN) lost their dominance. Slightly less stressed Renesola have had trouble growing their global presence after their huge success in 2012 and early 2013. Note that their relatively new global OEM manufacturing base might distort CEDR's reflection of their global shipments for recent months. HSOL always having mediocre product offering and marketing compared to leaders is a long-term lagger that grows slower. Despite having been around much longer as module brand than many others they achive less volume, especially considering that a lot of their exports lately are tolled QCELLs modules. Edit: I'm adding an index style chart, where they all start at 100 in June 2013. This illustrates the difference in growth rates more clearly. Solar9 in total grew global presence with 17% the past year. Biggest losers Suntech and CSUN lost 50% of their presence, while biggest winners Jinko and JA gained around 90% global presence. Edit2: I'm adding total shipment charts as well for the same period. The monthly data was based on estimates and interpolation of monthly domestic shipments from quarterly total shipments and monthly export data. Some definitions are needed. For total shipments only external products sales related shipments are included. Any shipments related to internal downstream projects, processing service for other brands or warranty replacements etc. are thus excluded. For exports this is not true. There all shipments are included, but in most cases internal downstream projects and processing service for other brands are likely more negligible than for domestic shipments (HSOL tolling QCELLs module and exporting them to high ASP markets and CSIQ global projects being the most significant exceptions). For 14Q2 the guided/guestimated total external module shipments was used. Note that Suntech could not be included in total shipments as there's no visibility there, but I kept them in export charts since although Suntech ADS is worthless Wuxi Suntech is still a panel market player, now in the hands of the new cowboy in town (Shunfeng). Module exports grew 17% for Solar9 in the period, but total external module shipments grew 40% for Solar8. This is partially explained by Suntech drag not being included in total shipments and domestic shipment growing fast than international (naturally as China market has grown faster than international market the past 2 years). Note also that the "domestic" sales part (diff between total and export shipments) actually would include international module manufacturing too. SOL and CSIQ should have the most significant impact from that. A couple of interesting conclusions are that several of those losing market share on the international scene have been able to exploit domestic demand to retain utilization levels despite that loss, but likely at the cost of lower margins. Yingli increasingly continue and CSUN, SOL and likely Suntech massively started to rely on domestic demand to keep their manufacturing lines busy, while HSOL are still skeptical about betting much on domestic market. Trina keep and CSIQ started to exploiting domestic demand peaks, while both being strong in international market between the domestic booms. Jinko maintain a strong and stable domestic presence while growing international presence. JA is reducing domestic presence and managing to more than offset that with fast growing international presence (applies to cells as well). Even though trend for CN4 leaders is not as strong for total shipments as for exports I still view this as a signal of the CN4 brand and financial strength. They gain in the most attractive markets that have tougher barriers, while the weak have to resort to the less attractive but more accessible domstestic market. Edit3: Attached charts updated for Q2 actuals and July CEDR. Edit4: Attached charts updated for August CEDR.
  2. 5 points
    For those who did not request via PM, e-mail from Ed Job, Also, Nomura note sent by Ed, both on Friday. Second e-mail with attachment from Nomura had this text: Robert, This is more interesting than the oil price.... because the oil price does not matter... oil cannot compete with solar. Regards, ed First e-mail Robert: Thank you for the article on Seeking Alpha. Many investors sent the link to me and some of our large investors actually agree with your analysis. Moving on to your questions: There is no real link between oil and demand for solar modules. Very few countries burn oil to produce electricity, and in my calculations, oil would have to drop below $20 for electricity produced from oil to be competitive with solar energy. In some geographies solar energy competes with natural gas prices. Oil may affect natural gas prices to a certain extent, but even then, natural gas prices need to drop over 50% from current levels, and stay at the new low levels for 20 years to compete with solar. I do not expect any impact from current oil price decline on the demand for solar energy in 2015 and beyond. I don’t know of any particular event or new news that may be causing weakness in solar stock prices in general. Some people seem to be focused on oil prices, some on ASPs, and some on currency fluctuations. Overtime fundamentals will prevail. We will provide more detail re: 200MW mentioned on the call as developments warrant. Typically we only consider a project for inclusion into our late stage pipeline once the land is secured, and we have a PPA with a credit worthy off taker, and in some emerging markets I would add, construction and project finance secured as well. Meanwhile we will focus on the 1.4GW of late stage pipeline that we have to deliver results in the quarters ahead. We will provide more guidance on or before our next call. Getting into a debate with negative analysts is not productive in my view. The best use of management time is to focus on the execution of our strategy. Talk is cheap, execution takes time. We believe solar adoption will accelerate in 2015 as more countries adopt solar, and Canadian Solar is well positioned in the industry. As developments warrant we will make disclosures to update the state of our business. Best regards, Ed Job Director, Investor Relations Canadian Solar Inc., 199 Lushan Road, Suzhou New District, Jiangsu, China 215129 Tel: +86 512 689 66525 Mobile: +86 130 7338 4046 NASDAQ: CSIQ Nomura India raises target 5x to 100GW by 2022 112814.pdf
  3. 5 points
    Things we need to learn from this GTAT fiasco is that: 1. balance sheet is important. it is important to stay in the business than talking about great future. 2. high short interest always raises a red flag. Many longs here think short interest is a good thing since it could fuel the the stock to the upside and could even cause short squeeze (yes I know VW short squeeze story but it's rare). To be honest, shorts do a lot of homework since they have limited to gain and unlimited to lose. Raising short interest is always a red flag and we need to think about what we have missed in our analysis. Feel sorry to GTAT longs but think about the positive side of the life and life is more than money and has to go on.
  4. 5 points
    This is probably the most detailed reporting on the imminent release of the new policy. http://solar.ofweek.com/2014-08/ART-260006-12003-28860729.html A quick summary: The National Energy Board had organized an on-site meeting on 8/4 in Jiaxing, Zhejiang, with participation by the heads of 36 provincial energy departments and executives of 29 energy enterprises, including the two major national grid companies. The reason to hold the meeting at Jiaxing is that it has solved many difficulties in DG and can provide a model for other places. Mr Wu, The director of National Energy Board, said a new DG policy will be announced, and if electricity sale of a DG project does not meet the projection, it can be transferred to receive the subsidy for ground stations. The new policy has gone through all review and sign off processes by different divisions of government and is waiting to be officially released. In order for the new policy to come out in time to finish 8 GW of installations in 2014, it is expected to be published in August. Main changes of the new DG policy: The scope of DG will be expanded to cover 20 MW or below projects built on waste land, abandoned hills, tidal beaches, ponds, and agricultural greenhouses. These projects will receive 1 YMB ground station subsidy. In addition (I think I missed this before), rooftop projects without enough portion of self electricity use can also enjoy the 1 YMB subsidy. Also by the end of June, Zhejiang province has 1.38 GW of DG projects on file, 673 MW are under construction, 145 MW connected to grid.
  5. 5 points
    I may be wrong, but I don't think any "de-listing" news, tariff news, or any other recent news really had anything to do with the solar sell-off the last few days...albeit the sell-off I'm sure was somewhat magnified by the media and short analyst types that used it to scare some weak retail hands out...but that's actually a good thing in the long run. The rest was just day-traders taking advantage of high volatility. Sometimes people overreact to sell-offs, and have to find a reason why...when really there is no real or good reason that's specific to the stocks or sector themselves. The lame stream media does this every day...if the market is up or down on any day, they will come up with a universal reason why. Sometimes their reasons really are stupid, but the still have to come up with their headlines. So if the de-listing theory or tariff theory is true, then why did FSLR and SPWR also go down quite a bit? The market was down big Friday, the DOW down over 300 pts. So why wouldn't we expect our low-float, low-market cap hi-beta solar stocks to not only go down, but to go down a lot more. You have to take the good volatility with the bad. Remember they can also go up 10% in a day on no real news. The end of the week was nothing more than short term technical trading and market forces imo...there is absolutely nothing that changed fundamentally (including the delisting "scare"), from the beginning of the week. The smart money knows this also. Does anyone think Nomura has changed their minds on CSIQ/TSL etc. over the last week?...of course not. So why would we, especially since we are very educated here as to what's really going on. We are in a great position to take advantage once again of the overall market's ignorance, stupidity and overreaction when it comes to solar stocks...but it does take some guts to buy when everyone else is selling. Compared to the old days, these latest moves and threats to our companies are just a walk in the park, and the certain analysts' attacks now just a whimper. Sooner or later it always comes back to the fundamentals. So just relax and be patient...solar is the fastest growing industry right now, and becoming more profitable every day. Nothing that's happened in the last few days is going to change that. I'm pretty sure the highs for the year haven't been seen yet... btw, when it used to get crazy like this, I would just pull out my CSIQ project spreadsheet, look at the hard numbers of revenue and profits on the horizon, and that would give me strength to see the short-term nonsense thru. That's why I stuck with CSIQ...their future was (and still is) much more visible than the rest. Smart money will also "overpay" for that visibility too. And that helps me sleep well at night, even during short-term chaos like this. So my advice; Relax, and if you can, take advantage of the short-term fluctuations of an irrational STEO market...
  6. 4 points
    They killed it my God http://investors.canadiansolar.com/mobile.view?c=196781&v=203&d=1&id=1988651
  7. 4 points
    Great replies all on my post…thanks Looking at what I wrote again, my original intent was just to comment on JMK’s observation that we are still just at the beginning stages imvho of this solar/renewable revolution, with huge upside potential…and then I started rambling on and going on a tangent as it’s sometimes hard to control my enthusiasm for CSIQ’s future. I know most here believe this to some extent about the solar future, but the day to day stuff sometimes makes us lose sight of this. Just wanted to remind everybody that there’s no need to get in and get out before it’s too late…and that $50 or $60 that seems like such a stretch to some people right now, could be peanuts in the future by comparison. Keep in mind the investment community is only now starting to embrace the sector. Although I always believed solar in general had an extremely “bright” future, it wasn’t really until CSIQ’s first really big win in the project business with TransCanada, with comments that much more was to come, that got me going because I finally had something solid I could bank on. The panel business at the time was a very tough way to make a living. I didn’t know who was good and who was bad, or who would even survive but I knew that I really liked their new business plan and the now visible revenues/profit streams that were to come, and also their Westernized approach. And with spreadsheet in hand (and yes, it’s so clear now from CSIQ that it’s become obsolete), I fought those crooked lying Tier-3 STEO analysts every step of the way! (btw, whatever became of the fantasy analyst? or my nemesis? or…nevermind…looks like Gordo is the only one left...inside joke for the old-timers here). Their overall execution of it to date has far exceeded my expectations…that’s why I keep holding. As far as my CSIQ buy and hold strategy being unique to CSIQ, as Odyd commented…maybe it is…at least to this extent (I said many times in the past that this was a once in a lifetime opportunity, and I still think it is…albeit to a somewhat lesser extent). There was also a lot of luck involved that I’m very thankful for. But if you find any company in any growing industry that has a solid, visible long term business plan that’s differentiated from the competition, and they continue to execute, then continue to hold. If they don’t…sell. Let the micro-second computers and day-traders fight it out day to day…I seem to always lose that battle eventually anyways. DD and investing is how you beat them. If they drop the price irrationally…don’t panic and sell…thank them for the opportunity and buy more! Stay strong until the long term business plan starts to falter (this can be due to both controllable internal and uncontrollable external factors)…as EPS is still king. Of course this approach does not guarantee success…but I do think it improves the odds for the small-fry. Sorry…looks like I’m rambling on again… Although I thought it would get there eventually…I was as surprised as anybody with that run...
  8. 4 points
    I recall I first did this on 3/26/2014 when we had the first severe correction following the highs in early March. Instead for it to get lost in the forum again, it's better to create a new thread to keep track of the performances of our stocks.I think it's useful to keep things in perspective and use it as tool for fine-tuning your portfolio. As of Sept 10th, 2014: Stock 2013 Close Close Today High Low YTD Since High Since Low Max Loss CSIQ 29.82 39.07 44.50 21.71 31.02% -12.20% 79.96% 51.21% JKS 29.30 33.50 37.98 22.37 14.33% -11.80% 49.75% 41.10% TSL 13.67 14.13 18.77 10.32 3.37% -24.72% 36.92% 45.02% JASO 9.17 10.13 13.14 8.49 10.47% -22.91% 19.31% 35.39% DQ 36.30 47.11 56.98 21.86 29.78% -17.32% 115.51% 61.64% HSOL 2.77 2.60 4.24 1.75 -6.14% -38.68% 48.57% 58.73% SOL 3.45 3.36 4.46 2.18 -2.61% -24.66% 54.13% 51.12% YGE 5.05 3.77 7.45 2.79 -25.35% -49.40% 35.13% 62.55% Some quick observations: Year to date, the CN5s all have positive returns with CSIQ and DQ as clear leaders. The CNR3s (rest 3) all have negative returns with YGE as the worst performer. The trend indicates the gap between leaders and laggards is widening. All CN5s plus SOL are within 25% of their respective highs, with JKS and CSIQ leading the charge. DQ is the runaway winner since reaching its low and CSIQ ranks at the second with the rest placing further behind. This is explained by the more severe correction both names had since reaching their highs and also by the strength with which they have snapped back. On the other end of the spectrum with less volatility, JASO remains a clear underachiever since the low but it also provides a hedge during the down turn while still maintaining an exposure to solar (explo's strategy). We all hope this is going to change soon. Personally, I think it'll be some time in Q4. As some sort of risk measure, "Max Loss" represents the loss incurred when someone happens to buy a stock at the high and sell at the low in panic. Based on this measure, JASO is the least risky (as expected but it's even less so based on more recent trading patterns) with YGE and DQ the most "dangerous".
  9. 4 points
    I'll just throw out that same old note of caution on CSIQ. On the module side, they're in the same boat as the rest of the China solars. They don't have the lowest costs, they don't have the highest quality, they don't have a critical brand advantage, and they're actually building (costly) new capacity. So there's no massive advantage here. On projects, they have no great advantage within China - JKS and TSL and other, non-module players do. In the US, they have no essential advantage over a SUNE (or others) given that these others can access cheaper capital. They're working to develop projects in Japan etc., but it's not at all clear that this is going to grow substantially. What they have is... the remaining Ontario project market. Yes, they were smart to seize it. Yes, they've done a good job with it. But does it put them in a fundamentally different position than the other China solars? I'm not so sure. (And I know the Ontario FIT program a bit - I used to work in the Ministry, was on the edge of the talks as it developed, was doing solar in Guelph 15 years before CSIQ arrived, etc.) But believe me, there will be no replication of those kinds of rates, EVER again. Ontario's Government almost fell over corruption around its gas plant purchases - and perceived overpayments for wind and solar have been a real issue. Those days are done. So what CSIQ has is an enormous vault, and within that, are a stock of very profitable Ontario projects. My advice is to ride them high now, and then - since they can be expected to have AT LEAST two more quarters like this - to either stay on the horse and try to ride it to a long-term high, or, to step off periodically to try and time some declines, and then ER-related run-ups and recoveries. But $40 is certainly within their grasp, and perhaps even $50. This comment is just to say that while CSIQ's Ontario projects have enabled it to appear as fundamentally decoupled from the other China solars, and while they obviously would LIKE to be, the depth of the difference is perhaps less than it might seem at the moment.
  10. 4 points
    Jinko Power Jinko Power is not a pure yieldco, it encompasses project development, financing, EPC, and O&M. It's more appropriate to think of it as a growth IPP. In the future, her relationship with the parent company is in module sales and support in other areas, rather than project development and transfer by the parent company. Model shipment to Jinko Power will not be included in sales and continue to be capitalized into plant assets. It won't affect revenue and profit of Jinko. The preparation for the Yieldco IPO is ongoing and a top focus point of the management for the second half. Both US and Hong Kong are possible locations for the IPO. There is no specific time table yet. There is no plan for share offering before the IPO. The current funding is sufficient to support the development of over 800 MW projects using leverage, that is, to reach 1 GB prior to the IPO. Capital raises through other means such CBs are not excluded. The 225 M capital raised will be used only for projects. Jinko will gradually develop projects overseas after the IPO. A lot of preliminary work has been carried out. DG Development The new DG policy will benefit Jinko greatly, especially on the downstream business. Module sales is also going to grow with the takeoff of the market. DG is the trend of future. Jinko currently has a 600 MW pipeline. The scale of signed contracts and MOUs is even greater. The development cost is right now about YMB 7 to 7.5 per watt including modules. Jinko has been rapidly growing her DG teams, including development, financing, and engineering. Some are being outsourced. Manufacturing Jinko will use the capital used for bidding Topoint for capacity expansion. By the end of Q3, wafer, cell, and module capacities will reach 2.3 GW, 1.8 GW, and 2.8 GW, respectively. Regarding to retainage, it's a convention of the past. There are not many new contracts nowadays with retainage. Jinko has a total of about $30 M retainage revenue, which is expected to be fully collected within one year and a half. H2 is expected to see $5-$8 M being paid back. Regarding to the US tariffs, Jinko plans to pay the 2012 tariffs for the time being, which come to a combined rate of 29.18%. Jinko does not rule out the possibility of opening cell factories in the future overseas, including in North America. Jinko confirmed that the cost including the tariff is $0.62 (or higher). But with modules selling at $0.74-75+, it's still at quite profitable levels. In fact, it's similar to what it used to be using Taiwanese cells. (So GM is about 17% or even higher.) http://xueqiu.com/talks/item/20122155 This post has been promoted to an article
  11. 4 points
    Well, I swung out of China solars and into US solar firms (SUNE and SPWR) earlier this year, and that worked out well. I then (largely) stayed out of buying more China solars until after the tariff decisions. I even managed to avoid any recent disasters during the ERs, except for selling my CSIQ options far too early (at just $31), thinking this was a brief bounce and not a sustained rise. Bad error by me. And right now, I am on the fence with Trina's ER. (I added some TSL short-term options to my LEAPs, and they've risen, but I remain undecided about whether to hold them all through ER.) Looking forward odyd, I see-saw between the 2 views you described. Frankly, much though I love these firms, their guidance only offers us relatively flat ground - in terms of likely profits and share price rises - for the coming 3 months. Quite simply, they haven't offered us any obvious guidance or clear reason to indicate that they are going to surge like CSIQ. HOWEVER. Then I consider 3 basic - non financial - facts. #1. The industry, overall, is still growing at a huge rate. This always offers opportunities for supply/demand to get out of joint, and tightness to appear, and for prices to rise in certain regions. #2. We're now essentially past tariffs. Reducing uncertainty alone eases decision-making, and should enable the management of our firms to turn to more important decisions. #3. And most importantly, the China Solars have not made their big/strategic announcements. Yet. However, we know they're all seriously considering their options on how to act, post-US tariffs. And EU. And India & Japan threats. JASO was very open about this, for instance. So, I think it makes sense that a number of the China solars will have reviewed their options, and ALREADY MADE THEIR DECISIONS, and some of them will have decided to do more than to simply take the hit and bear up under the tariff. Now, some of their decisions will have a strong PR angle (I hope), but remember that firms like SCTY and others do remarkably well with good PR! So. A few possible announcements in the coming months, which could greatly change the state of play for the China solars: 1- One of them is going to make the leap and announce a US plant. This, for simple PR reasons, strikes me as a done deal. Even a small plant would have a huge financial impact, however, as it would open the door to the kinds of opportunities a CSIQ has taken advantage of - e.g. in raising share prices and thus, making raising capital easier, winning projects, etc. Maybe JASO? They're thinking about it, we know that. Maybe JKS? We know they now have a war-chest after their Jinko Power partnership. Maybe TSL? I don't know. 2- At least 1, and likely 2-3 China solars are going to announce they are converting lines over to use the Merlin system from GTAT. GTAT has already announced they are at the stage of final customization with a number of "GigaWatt-scale" China players. And they have sold equipment in the past to all of YGE, TSL, JKS and JASO. The Merlin system, if installed, is claimed to reduce silver use, cut costs/watt, reduce panel weight, etc. The claim is a 10% reduction in module cost. We'll see. But GTAT is smart. Rather than try to sell them expensive capital equipment, instead it is shipping them the material for each panel, and thus, cutting capex. A Merlin installation would also be a major PR gain for any of these firms, as GTAT is a rising golden boy in US manufacturing, with its likely Apple partnership on the iPhone to be confirmed in September. - Project sale, and/or developments. e.g. As soon as a JASO announces its first major project sale, as long as they find a way to communicate their PIPELINE with some clarity (which they failed to do during the CC), they will begin to rise, and could position themselves as being, in part, a new CSIQ-style player, only based in Japan & China. TSL could also announce a sale, and it could have even better results, as they have a wider investor base. - Buy-outs/Mergers. These still seem to me to be screamingly obvious moves, simply so larger financial players can pick up smaller panel manufacturers who are also collecting projects. For example, CSIQ, JKS and JASO would all be possible, though CSIQ's share price surge may be let them escape. However. If JASO was sitting on 500 MWs of projects, with 200 MWs ready to sell, plus that balance sheet of theirs... and their expansion complete, using a lot of new gear and high efficiency lines, why wouldn't someone purchase them? That company could double in value just by hiring some good PR people, and presenting themselves in the style a CSIQ has come to use. This has perhaps a lower probability, but is still possible I think. - Better Incentives and Prices from China. It seems to me obvious that, to some degree, political decision-makers can shape the prices paid for panels in China's projects. Right now, the prices are too low,and it's hurting the solar firms. Government gets to set the targets, how high, with what timelines, with what incentives, and to lay down enormous direction to and through quasi-state bodies, municipalities, banks, etc. - Movement into large new markets like India. It wouldn't be surprising to see more China-India joint manufacturing project announcements, I suspect. And doing so could bring a participating company access to a huge market, state-driven projects, incentives, etc. In sum, though the companies themselves, in their guidance, haven't given us much reason to hope for a share price surge, I believe there are a number of news-led possibilities that could drive up share prices. And so, positioning around those possibilities seems to me something worth keeping in mind. Just as it was with SUNE and its YieldCo (which, BTW, sadly never made me rich... but a 30% gain is not to be sniffed at. And perhaps even makes me feel a bit better about screwing up my CSIQ holdings! Argh!)
  12. 4 points
    Just listened to the CC again. The valuation is based on equity valuation of finished 213MW by the end of last year ($100m Jinko's old equity + $85m premium) and future capital need for 600MW (or more) connected to grid this year. So for the 213MW already completed, they are getting a fair price, since they are getting about 40c per watt premium which should give them 20% GM on the project itself. They are not selling 45% of 813MW here since 600MW of them is not even completed. If there's no outside investor then Jinko needs to raise own capital to finish them first so there is no valuation on that part yet. Basically it's an agreement to develop projection together: Jinko brings on the table pipeline, 213MW completed at market price and their expertise to build projects, CDB brings ability to finance (possible lower financing cost) and Macquarie brings possible future pipeline or other financial assistance. New horizon might bring easier permitting due to its political connection. Of course Jinko can choose to give up less equity but it would slow down downstream expansion process and they might have problem getting projects financed once it's completed. Right now, cash amount in the Jinko power is about 100m+90m+225m=415m and this can support 1.15GW projects as Zhang mentioned in CC ($1.2/w) cost. So with outside capital, Jinko can get 632MW (1150*0.55) own share of plants quickly before IPO without actually contributing much additional capital. Introduction of three investors can also facilitate the IPO process IMHO. So the valuation now is really about cost of the projects not the market value of the projects. When the IPO really happens, these finished projects will be valued at market price and that's when the interesting things start. Considering they are keeping the projects instead of selling, I am thinking about $2.5 to $3 per watt EV for their projects. This will give them at least $1.6 per watt equity ($0.9/w debt financing) per watt which translate to $1.84B equity valuation of the whole company for 1.15GW completed. Jinko's own share should be about 1B which translate into more than $30 per share. All these projects are funded securely now and financing should be easy since CDB is on board now. That would price Jinko's manufacturing part for negative which should actually have $45-$60 value in my calculation. Further capital beyond IPO can be obtained by secondary to public or capital injection by Jinko and partners. If three partners want to maintain their 45% stake (or some lower numbers after IPO sale), they should contribute certain capital to maintain that paid in capital %. Now I am just hoping they won't quit after IPO since it's vital for Jinko to keep that financing and political connection edge. I think they might even get lower interest rate from CDB compared to other CN peers who are developing projects in China. If interest rate is 1% lower, that translate into 4%-5% GM improvement for their projects. So the deal itself is not good or bad if we don't look at what partners brings to the table. In that case Jinko is just finding somebody to fund future projects and share profit with them. It's the unique capabilities three partners bring makes this a great deal for Jinko. And to question why it's 45% equity not 20% or 25% equity sold to outside investor? Maybe that's the required size of pie to attract CDBI and Macquarie to the table and make them interested to work together with Jinko and to contribute to a company in which they have a reasonable share.
  13. 4 points
    Politicians are used to the concept of energy being a power, natural resource found in the land or sea belonging to a particular country. Owning energy is a national security matter. Oil and gas and coal and any other natural resource are vital to the country and should be controlled. Wars have been fought over this in last 200 years and continue to be fought today, covered in the veil of spreading democracy to people who do not care to be free. Energy grid is a military installation and nuclear plants are being protected by military in case of a terrorist attack not because of the harm on the population but impact on the grid and power supply. Solar energy is different as it can be captured anywhere. It is not a natural resource in the meaning of an exclusive location. It can be controlled by tools. You can harness a lot or a little, taking the scale to your own hands. You cannot run out of it, not in the feasible future. It is also quick to build and put out anywhere. It is a contradiction to the traditional view of energy source. People who run the world are C students with money; lacking progressive education. They own political agendas passed on them by the principal figure of their household or based on the knowledge they gained some 40 to 50 years ago. The training says solar is energy and, therefore, a national security measure. The only way to control it is by existence of a national supply chain. Not having manufacturing of solar in own country is a risk we cannot allowed. Thinly saw up scenario? Not in the eye of a politician. Combine above approach with all kinds of phobia on yellow perils, which led to the division of China in early 20th century, communism and loss of the leadership on the global arena by the US, and you have an explosion of national interest in solar, leading to tariffs. Then consider country of Japan, completely open to solar power installations. Japan is a country without natural resources. Japan fought wars over resources, starting with one in 1905 with Russia. Those wars were fought to control ports and access to China and to gain resources to grow national interest particularly with Second World War, explicitly being fought for energy: oil. After the war, both Japan and Germany became economic powerhouses dropping political agenda of controlling own interest by means of war. They did not do it by evolution, but were forced to it by the victors. What it came out from it was the conclusion by governing elite that many wrongs had happened from hands of our fathers, thus we need to come up with own agenda on the world and every complex issue in it. This is the reason, in my view, why understanding of the solar energy does not have same implications in Japan or Germany. People who govern in both countries do not feel the need to control means of solar power for national security reasons. In addition, Japan has a strong supply chain in the subject, which makes those matters ease. In the EU, there was no problem for it in Germany, but it was different for France, a country that was not forced to change own political agendas. India is brought up on a political stereotype of a strongman of the region and political description what that means for energy. Tariffs are a convenient way to block a competitor on India’s home turf. What it comes down to is a view of solar as an energy and who controls it.. The fear that China will impose a political will on how to distribute tools to harness solar energy is the main reason for keeping national supply chains alive. Even in a place like India, where it cannot survive in the current economy, those manufacturers are seen by politicians as must have. China, of course, has not helped. Instead of market driven elimination, China used vast mechanism of local, provincial and country wide support system for solar manufacturing, calling it one of the most important industries. If Chinese think this is important, why we should not think in the same fashion, is an apparent political behavior elsewhere. In my view, this is why Chinese companies must build globally. Opening this business to a global scene by China will take every politician's argument away. It will also eradicate social xenophobia of unemployed masses, blaming China for lost jobs. In the end, it is the right thing to do as the social aspect is critical to the health of the industry and each country. If industry can take out political agenda from its core, building factories abroad is a way to do it, we all win.
  14. 4 points
    Odyd, I'm curious what do you're referring to? I mentioned a couple weeks ago that this felt like a walk in the park compared to the old days...now it almost does feel like the old days. But the level of uncertainty about all companies futures were very clouded back then...for many reasons on many levels. Certainly not the case today. These major "corrections" can also be major opportunities...there's absolutely no reason fundamentally for this level of sell-off. So why panic like there is? I'm sorry, but I don't share all this anxiety about the solar world coming to an end. I don't trust WS one bit, so I don't participate in their game. I play my own game...that I know I have a chance to win in the end. Their game relies on emotion...and I see many here are pawns of that (and it's very hard not to be), and it usually costs them. I keep reading some of the traders' abuse of real investors here...I'm not "married" to CSIQ...if one finds a stock that continues to execute on it's long-term business plan...and has a bright future for many years looking out...then why on earth would I want to sell it if I didn't need the money right now? And this actually takes very little of my time now, and has very little stress. As soon as I see the business plan begin to truly falter (and not just based on "headline" news), then I'll re-consider my investment. But I recently spent several hours fine-tuning 2013 project revenues/profits based on YE info, and updating estimates that now goes out to 2017. And when I look at the bottom line, I am revitalized with confidence...just like I was during the beatings down below $3, when it was nothing but doom and gloom. And the same can be done right now for many of the other solars. So good luck to those very few traders that are actually good enough to make it in the long run...and consistently time the tops and bottoms...I'm certainly not one of them, and didn't like the ulcers that came with it. But I'm not sure I like the implications of someone's trading strategy being superior to someone who invests in a company's long-term performance, and doesn't want to participate in these dizzying WS trading head games. side note to Odyd; my "more reply options" does not work anymore...I keep getting a not authorized to be there page.
  15. 4 points
    My couple of cents here: 1. I don't look at 10 years cash flow. Solar industry is ever changing and any disruptive technology can give a new look to the industry. Who predicted <$20 poly price when poly was over $400 several years ago? Shorter term (2-3 years) is more visible for both individual stock and the industry and I am totally fine with that time horizon to invest. 2. Looking at 2-3 years from now, CSIQ is perfectly positioned by generating huge cash flow from projects every year from high ASP and high margin areas. After 2-3 years, CSIQ can use the capital it accumulated to upgrade/ expand capacity or venture into other emerging markets. What they will do beyond 3 years is just guessing but they would have much higher cash reserve/access to western capitals than peers and I trust management to put those capital in good use and generate good return for investors. 3. High ASP in subsidized area is not sustainable. But gross margin in higher barrier areas (North america, Japan) might be sustainable (15%-20%) for down stream business. With ASP dropping, capital needed to to develop projects drops as well. I have no doubt CSIQ will make up the ASP loss by higher volume in most profitable areas. In the end, the experience and branding enables CSIQ to capture profits in most high margin and low risk areas. It's not like JKS doesn't want to venture into Japan. They are just not able to do so right now so they have to remain in highly competitive chinese market for projects. 4. Even in chinese market, CSIQ would be in great shape with 3GW+ soft pipeline. They have great connections with western banks and that gives them cheaper access to capital for chinese projects. With local loan rate as high as 6%-7% and no long term loan available, this become a huge advantage to generate high IRR on domestic projects. Successful projects development and great pipeline would make it easy to set up yieldco for China's projects as well which would facilitate the projects developing in China further more. 5. CSIQ's strengths are in sales channels, branding and downstream projects. All these will help them to grow and survive any likely downturn in the solar industry. $1 invested in fixed asset you need to worry about possible oversupply in the future, but $1 invested in projects that has electricity off take agreement gives you high and predicted return. Good relationship with customers and branding will carry on disregarding the dynamic changes in the industry as well So in my opinion there are CN2(CSIQ, JKS)+1(TSL) to invest now. But if I have to park all my money on one stock, CSIQ is the obvious choice to me.
  16. 3 points
    Hopefully this is the answer you were looking for http://solarpvinvestor.com/spvi-news/960-factoring-fear-into-canadian-solar-valuation
  17. 3 points
    EU will not pursue SolarWorld’s claims of Chinese trade breaches These are allegations, far from sound evidence of breaches. The Commission can only act on the basis of solid evidence,” she said. http://www.solarpowerportal.co.uk/news/eu_will_not_pursue_solarworlds_claims_of_chinese_trade_breaches_2356
  18. 3 points
    Didn't bother to read the article, but my long and strong stance is based on my belief in the solar industry's continued strong demand growth over the next decade or more (whether or not that is based on PV as we know it today is a different story though). So $145 for JKS in 5 years doesn't sound all that crazy to me. The good ones will get there, even if the road is a bumpy one full of giant potholes and sinkholes... I believe all companies have at least some potential for significant valuation upside, but who really knows how this is all going to play out over the years. M&A could come into play. Will the current low cost leader still be the low cost leader in 5 years, or even next year? Who will have the best panels in 5 years, or even next year? What will be the best vertical integration strategy, etc., etc. At least the big picture is much clearer now than a 2 to 3 years ago, with most of the shake-out now in the review mirror. My belief in the long term strong growth of the industry helps insulate me from the frustrations and jubilation of the "irrational" STEO market swings. More often than not, the market is smarter than I am in the short-term (or I just stay too darn rational). So instead of always trying to out-gamble the STEO deep pocketed trading professionals, and the micro-second computers, I prefer to play the game on my terms, where fundamentals and execution of the long term business plan is all that matters, not the current quarter's EPS. Actually, that is what the market is supposed to be about...investing...before it turned into Las Vegas... Nothing against trading, I do some myself. But the long term upside is huge so make sure you got some tucked away...imho of course.
  19. 3 points
    I have to agree with odyd that market treated TSL stock a bit bad relative to peers past month and has just last couple of days started to correct that. Think about it. The project sale will demonstrate the EPS power of project sales (in a quarter of failed module shipments) which they plan to do even more rest of the year. A lot of module revenue got push out to Q2. Have the market missed that they'll actually severely beat analyst expectations on EPS and then guide for a monster Q2 and 2H? I think when Trina reports the market has to revise its fear position. A couple of operational and financially strong companies are printing higher and higher EPS while guiding even higher. That picture contrasts the fear propaganda too much. The risk is rather that Trina confirms the fear propaganda by revising down its explosive FY guidance, but no one has done this so far despite some having weak Q1 and I simply think the fear propaganda is wrong. It's a way to print something as an explanation to daily stock price movements and high beta explanation is too boring, so on the red day they find a plausible story and on the green day they got nothing. CSIQ also gave good explanation to the China halt. China market is not smooth. Annual construction permit process means permits are not ready until H2, thus all installs in China are basically done in H2. WS reads it like there's low interest to do install in China, while it's more about delay of permits to do them. Considering this I think it is quite remarkable that we can actually experience a very rare scenario of stronger Q1 than Q4 EPS reporting by JA and TSL. Regarding Jinko I think odyd might see the worries more than the possibilities. In Q1 their electricity sales should be double than Q4 as a lot of plants connected to the grid in December. They have a lot of retainage to start collecting from past two years of large focus on China panel sales. They'll sell a lot less in China and more globally in Q1 this will boost their ASP due to better mix even if both domestic ASP and international ASP could be down for them. They're savvy on sourcing raw materials and not locked by contracts and suppliers they might have been able get a decent average. Their non-Si have been guided to come down from $0.39 to $0.35 this year. Some of this might help offset Si increase in blended cost already in Q1. As Sunnysky have said their CB will boost instead of pressure their GAAP number in Q1 and mixed with all the positives and negatives above balancing eachother on the non-GAAP I think Jinko will show that not even a weak demand quarter can budge their pure strength. One of the possible negatives I see is increased U.S. shipments, since that market is expensive to serve and sales there benefit Taiwense cell partner more than the Chinese panel maker. This might change later with tariffs on Taiwanese cells (driving up ASP and margins on US panel shipments from the CN guys), so they might just position themselves in that market for now without it being very profitable yet. If we don't see a turn around in sentiment before this month is over I'd be surprised. The question is how long do we dare to wait? Yesterday I thought at least I had waited it out enough and moved from the stock that I've held based on expectation that it would be less exposed to drops this year (and it was) to all the stocks that have dropped this year that I've liked all along. So although I've not been in cash I took the plunge out of my safe name into the basket of fundamentally strong names. I good at waiting until the absolute optimal time to take the plunge and by value on the low so I expect that the pain might continue, but I don't think JA can outperform as much any longer as it has done this year. To provide perspective this is the change from 52 week highs of the investable CN5: JASO -27% JKS -39% TSL -44% CSIQ -50% DQ -60% With explosive guidance for 14Q2-Q4 I smell the shorts' brinkmanship approaching boiling point. 3 of the stock above did wildly outperform peers last year, but all warranted by company specific fundamental picture changes. Only in the case of CSIQ I think it got to a point of excess relative to the change in the picture of their fundamental situation. Especially since CSIQ appreciation came quite late compared to the picture change (felt a bit like exuberance effect was at work by late arrivers with only cursory insight to the industry). I like CSIQ better when priced somewhere between TSL and JKS. [Edit: I moved this here from the "TSL Q1 2014 EPS Competition" thread]
  20. 3 points
    BIPV can you explain where all industry experts are wrong when they say 14H1 will be down from 13H2 due to seasonality (as every year), but FY2014 will be higher than FY2013 since industry growth remains strong. Use this as reference (page 15) http://gcl-poly.todayir.com/attachment/2014051519124417_en.pdf and explain where your view differs from the industry insiders and industry research firms view that the industry will grow nicely in 2014.
  21. 3 points
    I thought the table summarizing the year-to-date actions could be a bit useful: Stock 12/31/2013 High Low 3/26/2014 Year to date Since low Since high CSIQ 29.82 44.5 29.82 31.09 4.26% 4.26% -30.13% JKS 29.3 37.98 25.45 26.74 -8.74% 5.07% -29.59% TSL 13.67 18.77 13.1 13.1 -4.17% 0.00% -30.21% JASO 9.17 13.14 8.35 9.62 4.91% 15.21% -26.79% HSOL 2.77 4.24 2.41 2.92 5.42% 21.16% -31.13% SOL 3.45 4.46 3.04 3.37 -2.32% 10.86% -24.44% YGE 5.05 7.45 4.25 4.25 -15.84% 0.00% -42.95% DQ 36.3 56.98 33.71 40.69 12.09% 20.71% -28.59% From the highs, they all have lost about 30%, with YGE a bit worse. For the year so far, YGE is the worst performer. Among the CN5, HSOL and JASO, the two laggards have the largest year-to-date gains, whatever are left that is. From the lows, the two laggards are the best performing. On the other hand, JKS and TSL have given back all gains this year and then some. From the valuation and fundamental perspectives, these two might be the names one could consider to add to their holdings.
  22. 3 points
    Quick summary of Q&A (1) The average IRR of Jinko's projects is above 20% with leverage and 8%-12% without. (My comment: This is huge - looks like all they have are high quality project assets.) (2) Projects are currently mostly located in China. Project development overseas is also steadily progressing. (3) The Topoint capacity can surely optimize the company's cost structure further. It's already more than 75% utilized. (4) Jinko will carefully expand capacity based on market conditions, along with capital return rate, debt/asset balance, and financial leverage. (5) Jinko won't abandon the US market even amid the worst outcome of the tariff case and won't rule out establishing cell plants abroad or JVs with US domestic companies. (6) Jinko is still weighing both US and HongKong as the possible market for the Yield Co. IPO. This is to maximize shareholder's value. It's obvious that Jinko's downstream business is being undervalued. (7) There are still some key problems that need to be worked out for DG. Perhaps it can truly take off in the second half of the year. (8) non-silicon cost is expected to be further reduced by 8%-10% in 2014. http://xueqiu.com/talks/item/20121853 Note: Liu also pointed out that the module prices of around 4.2 YMB being mentioned in the news include tax. So these reports are in fact accurate but just being mis-understood.
  23. 3 points
    Forestg what are you doing on this site. Even if a company gives blow out ER you seem to feel a personal pressure to focus on bringing negative turns to every aspect you can come up with. I have my doubt if you do not fit in the picture of people that have been banned in the past. We should be happy as good er will be good for everybody but you seem to have a different agenda. lucky
  24. 3 points
    I did a review of historical data and found some interesting things. (google drive link to excel: https://drive.google.com/file/d/0B0WcxQcm29ewTXhTZDhCTVZqeWM/edit?usp=sharing ) In a 3 year period of both a boom and bust cycle there was only one company to gain equity during the whole period, Jinkosolar. Now revenue growth the king is Canadian solar with 111 mil usd growth QoQ and dominating in recent times. Historically during the last 3 years Jinkosolar has grown most revenue. Since CSIQ derives a lot of revenue from systems the two other more pure module players YGE and TSL are neck and neck historically (237 YGE vs 211 TSL during last 3 years) and recently TSL is pulling ahead. (YGE 130 mil usd 2013 so far vs 245 mil usd revenue growth in 2013 for TSL) I see most value in HSOL and JASO, with both companies having strong % values on Equity/MCAP and Revenue/MCAP. Historically however only JASO has had success in keeping equity (only lost 33,2 mil usd equity during the last 3 years vs 124 mil usd lost for HSOL) Granted very little is indicating we have another boom&bust cycle. More of a boom boom cycle. But it can pay to look at history sometimes. If perhaps to look at how well management does, I think it is a sign of a good management to manage equity growth during a bust cycle.
  25. 3 points
    http://finance.sina.com.cn/roll/20140118/002417995351.shtml There are some interviews or comments by several CN11 management in this article. Some key takeaways: 1. Domestic banks were hesitating lending solar companies money back in Q2 2013 but the situation has been improved since then. 2. CSIQ is targeting to remain at least 1GW late stage pipeline through 2014. So they would add similar or more late stage pipeline than they would install (consume) in 2014. 3. YGE is targeting to return to profitability in 2014. 4. GCL will increase wafer capacity to 10GW in 2014. Happy weekend everyone! Hope we will see some Q4 earnings pre-release from big players very soon.