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Klothilde

Solar Investor
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Everything posted by Klothilde

  1. Good news for FSLR and everybody else milking the U.S. PV market. The latest SEIA quarterly report shows the market is on FIRE. PV procurement (i.e. PPAs signed) has ballooned to 6.2GW in Q2, i.e. an annual run-rate of 24GW according to my calculator. Module prices remain sky-high at 35 cts for multi and 43 cts for mono-PERC. https://www.seia.org/research-resources/solar-market-insight-report-2019-q3 Could we now have some doomsday predictions with bifacial imports eroding prices in no time, etc., cuz the above report for sure has me fired up.
  2. Back in August some people wanted me to sell FSLR and buy ENPH. Thanks god I didn't. You guys need to be careful with your recommendations, I'm not as rich as you are.
  3. Interesting article on solar glass possibly becoming the next roadblock for the PV industry: http://guangfu.bjx.com.cn/news/20190909/1005678.shtml Please keep in mind for your module processing cost estimates.
  4. Two articles trashing the Chinese PV market: Has the domestic PV market been reduced to "chicken ribs"? http://m.solarzoom.com/article-130302-1.html China solar installations to slow as subsidy cuts bite: executive https://uk.reuters.com/article/us-china-solar/china-solar-installations-to-slow-as-subsidy-cuts-bite-executive-idUSKCN1VR08R '“I think from now until 2025 we are probably looking at 20-25 gigawatts (GW) per year,” Eric Luo of GCL System Integration Technology (GCL) said...' This is not good you guys...
  5. Jinko winning another tender in China for 80MW of 320W mono PERC modules. They bid at 1.83 yuan/W or $0.227/W ex VAT. http://guangfu.bjx.com.cn/news/20190906/1005319.shtml Some will say this is horrible, some will say this is great. And that's perfectly fine.
  6. I didn't agree that manufacturing costs for PERC modules were 20 cts today, I agreed that you can build a PERC module today for 20 cts if you buy PERC cells for 11 cts (below cash cost of cell makers) and convert them to modules for 9 cts. But you have to hurry up since PVInsighs has those cells on the rise again as cell makers may have gotten fed up of selling below cash cost. I would put JKS's in-house cost for mono-PERC modules in China nearer to 22 cts, i.e. 7 for the wafer, 6 for cell processing and 9 for module processing. As to OPEX & Int the watt figure has not fallen over the last quarters but increased, so I'm not very confident they can bring it down much below 4 cts/W even including China. Throwing in 500MW of CN for free lowers it to 3.7 cts/W but AFAIK gasoline in China is not free of charge (btw, how did you get to 3.1 cts/W??). Keep in mind that they threw additional equipment lease payments into OPEX and also that their debt increased significantly over the last quarters (...and their project debt is a very small part of it). In summary selling for 23 cts when you produce for 22 cts and are running an avg. of 4 cts in OPEX & Int is not such a good proposition imho.
  7. I agree with your numbers but was thinking a step beyond. If China's prices don't bounce back soon then they will drag down prices everywhere else, and that could prove extremely painful for our companies. For example JKS is running OPEX & Interest at 4.3 cts/W. At an ASP of 29 cts they require a margin of 14.8% to break even. If that ASP drops to 23 cts then the break-even threshold jumps to 18.7%. We've all applauded their GM guidance of 18-20% for Q3, but truth is in a low price world that GM may bring you just to break-even. Do you understand my concern?
  8. More guangfu gossip. This piece summarizes results of a recent module tender in China, where both the lowest and the average bids for mono-PERC modules came in below 23 uscents. This is consistent with the horrible numbers we've been getting from PVInsights: http://guangfu.bjx.com.cn/news/20190904/1004654.shtml This is bad for all manufacturers who rely on big shipments to China in H2 in order to meet their guidance. They will have to swallow those prices. No names please.
  9. Latest Japan PV auction coming in at an average of 13.0 Yen/kWh: https://www.pv-magazine.com/2019/09/03/japans-fourth-solar-auction-concludes-with-lowest-bid-of-0-098-kwh/
  10. You are referring to some minor hiccups that they fixed and that hardly had any effect on the overall timeline. Fact is they started the first 3 S6 factories on time and even pulled forward the start of their 4th factory (Vietnam 2) by one quarter from Q2 2019 to Q1 2019 (compare timelines of Dec 1017 and Dec 2018 below). In July they produced 322MW of S6 modules from a nameplate monthly capacity of 350MW (con call). That's above 92% of utilization and includes the newest plant in Vietnam which they've just started up in Q1. They claim to be on track to hit their S6 volume and cost goals for the end of the year. Not sure I can see a botched execution in the above like you do. To the contrary, the fact that they are running S6 already above 90% utilization means to me ramp is essentially a done deal and it's about fine-tuning from here on. https://s2.q4cdn.com/646275317/files/doc_event/3-First-Solar-2017-Analyst-Day-Operations-Update.pdf https://s2.q4cdn.com/646275317/files/doc_presentations/2019-Guidance-Call-Presentation-Final.pdf
  11. S6 was pulled forward from the original roll-out plan and the ramp has been fully on time if not ahead of plan. You are suggesting a ramp full of delays and glitches but that's just wishful thinking on your part with nothing to support it. As to your trading strategy feel free to do whatever makes you happy. I don't trade because I got burned long time ago and also because I came across some nasty studies with scary winning odds. But IF I traded I'd at least make sure the stock is not overpriced from a fundamentals point of view so that I could have confidence that the long-term share price direction would be flat or increasing and not decreasing. But that's just me.
  12. One analyst mentioned that JKS is throwing in bids for mono-PERC in China at prices in the low 20s... Let's wait for the transcript to see what's cooking. But we may be up for an ASP slump in Q4 based on a large China shipment fraction at low prices. SC, what's your estimate for ASP and CPW in Q2? P.D. Applying the 2018 module revenue fraction of 0.966 (20F p F-28, excluding systems revenue) I estimate: Q2 ASP = ($1007M*0.966)/3386MW = $0.287/W CPW = $0.287*(1-0.165) = $0.240/W That's the blended cost, in China alone they may be 1-2 pennies below blended.
  13. There's a humongous difference between basic and diluted. I bet they'll explain in the con call.
  14. kudus on nailing the margin!
  15. The way I look at it the FSLR share price of $62 splits into $16 for its net cash and $46 for its operations. $46 at a P/E of 15 corresponds to $3 in yearly EPS. I think they will exceed that handsomely in 2020, so I consider the stock cheap. And if you deduct a further $10/share for project assets on balance sheet that makes the stock even cheaper. As to your TTM EPS assessment I think it is a flawed metric to assess future EPS in a setting of significant market and company fundamentals transformation. If I were to look for the first time at a consumer goods company or a utility company with decades in a stable market then - yes - I would look at TTM EPS to get a first feeling of their earnings power. But e.g. in the case of TSLA this metric is irrelevant since everybody knows they are just starting to ramp up shipments and earnings. In the case of FSLR it is just as irrelevant as everybody knows that S6 shipments, revenue and earnings all are heavily skewed towards the latter quarters of the year. Even you know that but you keep looking in the rear view mirror to make FSLR appear expensive. yawn. Besides you seem to have overlooked that this TTM EPS view generates an even crappier picture for Daqo, one of your favorite companies. Yahoo has them at a TTM EPS of -$0.19. By your own standards this is a company one shouldn't touch with a ten foot pole, yet it is one of your favorites. This screams inconsistency in your reasoning but maybe you can explain.
  16. I don' t think the market has baked in terrific results for FSLR next year. As with all shares the price reflects the average market sentiment or expectation. The market in average does not expect S6 to fail miserably and neither does it expect S6 to hit it out of the park but it expects something in between. Why don't you simply take the sentiment on this board towards FSLR as a proxy for the whole market? I am the only one who thinks FSLR will do extremely well next year and AFAIK everybody else thinks FSLR will fail miserably next year.
  17. Getting some vibes in the PVIL weekly write-up that Q4 demand will be below expectation: "...the heat of single crystal PERC in the fourth quarter is still expected, but it is likely that some of the domestic demand in the fourth quarter will be deferred to the first quarter of next year. The price of components in the fourth quarter is unlikely to rebound significantly..." http://m.solarzoom.com/index.php/article/129942
  18. Longi and Tongwei are terrific companies. DQ is also a great company, however it has become horribly overpriced. JKS and CSIQ on the other hand are just instruments designed to sell shares at a high price and get them back for peanuts. Imho of course.
  19. Will you ever say something positive about FSLR ?
  20. Just plugged in my Q2 estimates into estimize you guys. Q2 Rev: $927.3M Q2 EPS: $0.08 In other words, peanuts again. Does anybody see more?
  21. Things looking horrible again over at PVInsights you guys. You sure about that booming market?
  22. I take it you don't see polysilicon prices falling further then because right now mono-grade poly is selling for $9. I personally don't think current prices are low enough to force Wacker and OCI out of business. They both reported positive EBITDA in Q2, which suggests operating cash flow is positive under current prices. I think mono-grade polysilicon needs to fall below $8.0 for them to die.
  23. I agree that Wacker and OCI will have their business crushed. Just to illustrate: the new capacities of Xinte and Daqo (36+35kt) are enough to replace one of the foreign players. That also implies market prices falling further below the cash cost or even production cash cost level of Wacker & OCI for a sustained period of time so that they make the strategic decision of shutting down their plants and withdrawing from the industry. For this to happen prices need to fall 10-20% from current levels imho. At what price do you think the non-Chinese poly players will throw the towel? And what will DQ EPS be at that price?
  24. Xinte TBEA, one of Chinas top 4 polysilicon producers, announcing H1 2019 results: http://fastsfc.com/document/7876336 H1 metrics: 18200 tons produced at an ASP of $8.7/kg and cost of $7.3/kg Current capacity of 36kT/year to be expanded to 80kT/year by Q3. Both quality and cost position set to improve. Takeaways: - Lower cost position than DQ. Myth of DQ being the lowest cost producer busted. - New capacity of Xinte will expand total polysilicon supply in China by 10% approximately. Together with a similar supply expansion by DQ (4A) we are looking at 20% supply expansion just by these two players over Q3 and Q4. Very likely to screw up supply/demand balance further and lead to further price erosion in 2020. --> Careful with your 2020 ASP and EPS estimates for DQ you guys cuz it sure looks bloody
  25. Found some evidence to support my wild speculations. They had 'hundreds of megawatts' delivered to the Kiamal Solar Farm in Australia by June 8: https://www.sunraysiadaily.com.au/story/6206607/ouyen-boost-kiamal-solar-farm-on-schedule/ In an EPC payment schedule those modules usually are invoiced upon delivery, so it is likely that the EPC revenue within MSS in Q2 contains a nice chunk of those modules. http://investors.canadiansolar.com/news-releases/news-release-details/canadian-solar-partners-biosar-build-256-mwp-solar-project-total
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