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Sour reaction to great reports is not a good omen. I remember second half of 2010 and some analysts said "things can't get much better than this" when things looked brighter than ever and next year showed massive shipment growth while PPS faded before falling off a cliff. Mr Market is sensing this party is peaking and moving on..?

Edited by explo

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Back in CSIQ at 15.11.  Fully loaded, looking for a small bounce here, won't be holding these shares long.  Looking to unload at 15.50 unless it can break through easily and then I'll be dumping around 15.8x.

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$15 CSIQ looks amazingly cheap vs its peers. Unfortunately it means nothing in terms of share price. While JKS made a sizable rally from 17 to 29 CSIQ made almost nothing. I do not see too much downside from 15 unless a general market crashes. But a general market today consists almost out of FANG and related stocks (they are responsible for 75% of general market moves) i.e. totally under control.

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CS downgraded JKS today from Outperform to neutral.  

However the PT went from $20 to $25.  They boosted their 2017 EPS to 2.30.  The top P/E they imagine is an 8x multiple, on down to 5x.  

Blue sky 34, base case 25, grey sky 4 PTs.

I would post the whole PDF, which has their thinking well detailed, but I have a ridiculous .2MB file upload max size.  Maybe I'll upload the old Atari Combat game instead.

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5 hours ago, alex_iff said:

$15 CSIQ looks amazingly cheap vs its peers. Unfortunately it means nothing in terms of share price. While JKS made a sizable rally from 17 to 29 CSIQ made almost nothing. I do not see too much downside from 15 unless a general market crashes. But a general market today consists almost out of FANG and related stocks (they are responsible for 75% of general market moves) i.e. totally under control.

Hi, Alex, it has been a long time.  I share your view on cheap CSIQ. I look at the CAFD, and the stock is worth about $1.1B based on the solar plant value of $1.96 per watt, not including debt.  They have 569MWac and CSIQ owns 969MWac globally. the stock is worth $860M and the company produces roughly $2.8B in sales a year just from operations of selling modules. Apparently selling US solar plants in Q1 deprives the company of $1B in value according to an analyst from Barclay. That is $16 off the stock price for late sale.  Some things just do not make a lot of sense.

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8 hours ago, dydo said:

Hi, Alex, it has been a long time.  I share your view on cheap CSIQ. I look at the CAFD, and the stock is worth about $1.1B based on the solar plant value of $1.96 per watt, not including debt.  They have 569MWac and CSIQ owns 969MWac globally. the stock is worth $860M and the company produces roughly $2.8B in sales a year just from operations of selling modules. Apparently selling US solar plants in Q1 deprives the company of $1B in value according to an analyst from Barclay. That is $16 off the stock price for late sale.  Some things just do not make a lot of sense.

Analysts  have been really focused on the effect of Suniva to supply & demand.  Lots of questions in Q1 about the boost in demand, and now in Q2 about the decline in demand re: Suniva.

I have not seen an analyst compare solar plant values in a similar way to Robert's most recently yieldco article on SA.

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19 hours ago, pg6solar said:

Exactly why Trina left, JA wants to and can be taken out on a cheap, and Jinko will surely follow too.

I am closely aligned with a few private companies. They could easily go public at nine-figure valuations, but the thought of being public companies is simply abhorrent to their management.

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13 hours ago, dydo said:

Hi, Alex, it has been a long time.  I share your view on cheap CSIQ. I look at the CAFD, and the stock is worth about $1.1B based on the solar plant value of $1.96 per watt, not including debt.  They have 569MWac and CSIQ owns 969MWac globally. the stock is worth $860M and the company produces roughly $2.8B in sales a year just from operations of selling modules. Apparently selling US solar plants in Q1 deprives the company of $1B in value according to an analyst from Barclay. That is $16 off the stock price for late sale.  Some things just do not make a lot of sense.

I  come to a different conclusion in book values  and share price. If one takes project asset valuation less accrued debt. CAFD has nearly $1B in asset valuation in this instance vs CSIQ having near $300M in out of pocket investments for their projects.

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I think you are mixing corporate debt with project debt 

I would like to see your math. 

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7 hours ago, SCSolar said:

I  come to a different conclusion in book values  and share price. If one takes project asset valuation less accrued debt. CAFD has nearly $1B in asset valuation in this instance vs CSIQ having near $300M in out of pocket investments for their projects.

The market value of the CAFD stock right now is 79.1M shares times $14.84, that is about $1.17B. I just recounted their MW, they are 571.5MW of power owned by them. They have paid $1.5B for it (equity dollars) and borrowed against it $716M. If you take that as equity value you end up with some $788M against 79.1M shares. There is nothing else, no cash, no other income and dividends are paid out.

It means that equity value is about $9.98 per share. The stock as mentioned trades at a massive premium at $14.83. 

I think I understand what you are saying about CSIQ, but I think the evaluation you make is a bit different than what I see.

Let me explain. I look at the plants worth 1260MWp, which I calculate to be around 970MW ac, as $1.57B, given the value by the company. However, note that in the balance sheet project assets are $1.65B including construction. To properly assess the equity of solar plants, I add $220M and $65M, plus the not current project assets worth $147M, for a total of $2.118B, as a total value of all solar project in various categories.

At this point, we are ready to deduct $1.3B in debt, which also includes, of course, debt for projects being developed. That leaves about $818M of equity. I am going to use about 60M shares and that gives you $13.64 per share.

Based on current share price CSIQ’s manufacturing is valued $1.50 per share. One would think that I am done, but not yet.

The company stated following:

“The Company's portfolio of solar power plants in commercial operation was 1,260.2 MWp as of June 30, 2017, with an estimated total resale value of approximately $1.8 billion.”

Further down they recorded the value as:

“In addition to its late-stage utility-­scale solar project pipeline, the Company has a portfolio of solar power plants in operation, totaling 1,260.2 MWp as of June 30, 2017, which is recorded on its balance sheet as project assets ($1,308.5 million), assets held-for-sale ($203.5 million) and solar power systems, net ($65.8 million).”

That is a profit from their sale potentially. That is additional $3.7 per share or $222M. Adding all together we have $17.34. not only manufacturing is worth zero it operates as a deduction of value now at negative $2 per share.  There is absolutely no doubt in my mind that Barclays analyst who established his price knew that he has removed $16 in the price of CSIQ, he did say that himself due to a delay. I am very excited that market is so blind as the price is great to start a position or hold one.

Cheers

Robert

 

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