34,879 posts in this topic

13 minutes ago, odyd said:

I link when I find something at the time. I do not have a lot of time, but one can Google GJ and FSLR and read all links available.  The logic is simple but he made his call questioning expectations of earnings, beyond 2018. I do not remember or frankly care what his number is he came up with.

I included my calculation, capital costs and required profit to average cost the company has and it is unlikely to change. It is enough to start a discussion.

I though you were referring to a specific calculation and observation GJ made but maybe your were looking for comments on your calculation and observation..? You asked for someone holding FSLR to comment on some calculations..?

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1 hour ago, odyd said:

Explo, use the calculation I made. $0.03 gross profit in 2019 will be probably 11 to 12 % on ASP at the time of some 0.28. Use four cents if it looks better. 3GW capacity, 0.04 profit against $387M opex of today, which is very low, producing 3GW of modules today for them. What is your IS estimate for 2019?

Thanks. I think gross profits from pure panel sales will not suffice to offer the return their shareholders expects. And it was a long time since they did that. So I can agree that that (insufficiency of panel sales biz to meet return requirements from investors) will continue to be true. Another thing that is true it that they are taking a step back and preparing for the future now as many segments are sour. Not chasing projects in this fierce bid environment and primarily trying to dispose of legacy S4 inventory and remaining production before full ramp down doesn't mean that they won't continue to focus on the whole value-chain in the future.

JASO emerged from a transformation 3 years ago. DQ is emerging from one now and FSLR will emerge from one 3 years from now. I can see the less risk of buying something that's already emerged successful from a transformation (especially if it is not fully appreciated yet) than to buy something that is yet to emerge. I will if FSLR appreciates from this level again to mid to high 30's likely reduce exposure to it.

My investment in FSLR is not based on single year ROE, but total ROE since inception. If they don't think they got it anymore they should do a one-time dividend of $10 per share or something to improve their ROE, but they continue to sit on the cash. Likely because they remember that it made them king and rich (earning multiple billions for their shareholders) in the years that followed the hit of credit crunch in 2008. The position is strategic for both financial and technology reasons. It is not based on fundamental analysis of ability to produce a profit a single year. What I do think is that there is a high probability that they will emerge with the highest GM on panel sales in the industry once S6 is fully ramped. But, again, I don't think that will make the panel sales business sufficient to satisfy the shareholders' return expectations. If they don't continue to produce returns from the whole value-chain they need to pay that big dividend as the result of the S6 ramp up and remaining cash situation becomes clear.

Quote from their 2016 annual report about their business strategy:

We are vertically integrated across substantially the entire solar value chain. Many of the efficiencies, cost reductions, and capabilities that we deliver to our customers are not easily replicable for other industry participants that are not similarly vertically integrated. Accordingly, our operational model offers PV solar energy solutions that benefit from our capabilities, including: advanced PV modules; project development; engineering and plant optimization; grid integration and plant control systems; procurement and construction consulting; and O&M services.

And one example:

O&M is a key driver for power plants to deliver on their projected revenues. By leveraging our extensive experience in plant optimization and advanced diagnostics, we have developed one of the largest and most advanced O&M programs in the industry. With more than 7.1 GW DC of utility-scale PV plants under the O&M program, we maintain a fleet average system effective availability greater than 99% . Our experienced O&M staff enhances the probability that our customers’ power plants produce the energy predicted in their energy model. Our products and services are engineered to maximize energy output and revenue for our customers while significantly reducing their unplanned maintenance costs. Plant owners benefit from predictable expenses over the life of the contract and reduced risk of energy loss. Our goal is to optimize our customers’ power plants to generate the maximum amount of energy and revenue under their respective power purchase agreements (“PPA”) throughout the operational life of the plants. We have made significant investments in O&M technologies in order to develop and create a scalable and sustainable O&M platform. Our O&M program is compliant with the North American Electric Reliability Corporation (“NERC”) standards and is designed to be scalable to accommodate the growing O&M needs of customers worldwide. We believe our O&M expertise and scale are significant differentiators, as it is difficult for many competitors to replicate this experience.

2016 annual report: http://files.shareholder.com/downloads/FSLR/3942108867x0x936441/FF229006-19D1-4DC5-B7F3-AE92F8153C15/First_Solar_Annual_Report_Web_Posting.pdf

 

Edited by explo
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Solar stocks don't want to participate with the general market rally today.

JKS seems to be pressured (hoping no bad news is in the work).  If pressured further, it might be good time to move some CSIQ to JKS.  A couple of weeks ago the spread was $5, now it is close to $3.  Historically, the spread was around $2 to $6.

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2 hours ago, Jetmoney said:

Solar stocks don't want to participate with the general market rally today.

JKS seems to be pressured (hoping no bad news is in the work).  If pressured further, it might be good time to move some CSIQ to JKS.  A couple of weeks ago the spread was $5, now it is close to $3.  Historically, the spread was around $2 to $6.

Yes, but that was in CSIQ's favor.

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26 minutes ago, pg6solar said:

Yes, but that was in CSIQ's favor.

You are right.  However, for the past year or so, the spread was in JKS favor.  Now with Explo's PT, and even Odyd's PT (JKS at 20 and CSIQ at 17), if the spread is less than $2, it might be good to make a switch, provided that nothing bad is brewing in JKS.

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10 hours ago, Jetmoney said:

Solar stocks don't want to participate with the general market rally today.

JKS seems to be pressured (hoping no bad news is in the work).  If pressured further, it might be good time to move some CSIQ to JKS.  A couple of weeks ago the spread was $5, now it is close to $3.  Historically, the spread was around $2 to $6.

This year will be a test. Some have already lowered expectations and some have been more positive. For some reason I "feel" more comfortable holding JKS than JASO or CSIQ over the coming ER season.

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Looks like NEP got some needed attention.

Sent from my HTC One_M8 using Tapatalk

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1 hour ago, odyd said:

Looks like NEP got some needed attention.

Sent from my HTC One_M8 using Tapatalk
 

Good action. Up 3.33% to $33.33. Why use too many different digits? :)

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