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JA Solar (JASO)

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Can you believe Briefing.com is showing JASO earnings as a .10 cent miss...Can you believe the manipulation!

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2 hours ago, slowtrader said:

Jaso beats, Jks rises... I think this whole game is not for investors, but for amusement (and profit) of a few..

Think you just captured America's financial market in a nutshell there. Perhaps even business as a whole.

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Expected earnings delivery. Let's watch the stock tank.

 

JASO....driving shareholders crazy since 2013.

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Did anyone read the transcript?

They talked a lot about going private. It sounds like the committee did not have any objections as the conversation is about chairman doing the money drive and they are all good for it. I founded particularly interesting when they said they are not planning to give guidance for 2016 becasue of the offer? I am not sure when they ever did a year guidance, but I am surprise to hear it. Secondly does not this sound a bit pro-chairman? Clearly he is the insider, he knows what to expect, yet anyone in running (academically speaking) for the ownership of JASO would be deprived of those details.

Between SUNE collapsing and JASO being privatized I see SPWR somehow losing in 2016. This is a substantial shuffle, yet we may see YGE consolidate under delisting rules or maybe de-list, I would not be surprised YGE going on pink sheets and some sort of privatization taking place there as well.

We are witnessing another wave of industry consolidations. It may not feel like our investments are working, but competition for your shares will be taking on new level in 2016.

 

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10 hours ago, odyd said:

Did anyone read the transcript?

They talked a lot about going private. It sounds like the committee did not have any objections as the conversation is about chairman doing the money drive and they are all good for it. I founded particularly interesting when they said they are not planning to give guidance for 2016 becasue of the offer? I am not sure when they ever did a year guidance, but I am surprise to hear it. Secondly does not this sound a bit pro-chairman? Clearly he is the insider, he knows what to expect, yet anyone in running (academically speaking) for the ownership of JASO would be deprived of those details.

Between SUNE collapsing and JASO being privatized I see SPWR somehow losing in 2016. This is a substantial shuffle, yet we may see YGE consolidate under delisting rules or maybe de-list, I would not be surprised YGE going on pink sheets and some sort of privatization taking place there as well.

We are witnessing another wave of industry consolidations. It may not feel like our investments are working, but competition for your shares will be taking on new level in 2016.

 

I agree with everything but your last line. Depending on how 2017 turns out with ITC step down and Japan continuing to tapper, there may well be a competition to sell solar shares. If you look at market forecasts for growth in 2016 and 2017 you'll see that global demand is supposed to being slowing to to sub 5GW. Considering that right now we are growing in the 10-15GW range, I see real risk to margins. This slowing growth may force true consolidation in the industry as leading names push to grab market share. Obviously India could become the monster they want to be, or China could go crazy and install 30GW (without paying the promised FIT of course). Either way, 2017 is some time off and a lot can happen prior to then.  I'd just not sit comfortably thinking that time is inherently on the side of the solar investor.

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I talk about consolidating industry, which with growth reduction as only an estimate, faced with facts of separation between companies, still creates competition for the shares of few leading the seperation. While I live in the operational past I do not live in the current market reality. Yes there is a lot of confusion, with what if scenarios, but industry was not built on ITC, why would it collapsed with it? I feel very comfortable as I see what we predicted to see on individual company levels and industry as whole. Btw, there is a world outside of the US.

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13 hours ago, odyd said:

I talk about consolidating industry, which with growth reduction as only an estimate, faced with facts of separation between companies, still creates competition for the shares of few leading the seperation. While I live in the operational past I do not live in the current market reality. Yes there is a lot of confusion, with what if scenarios, but industry was not built on ITC, why would it collapsed with it? I feel very comfortable as I see what we predicted to see on individual company levels and industry as whole. Btw, there is a world outside of the US.

Obviously there is a world outside of the US. It is called China & Japan. Those three countries represent over 60% of global 2016 demand. Multiple companies make estimates for what happens post ITC step down and none are suggesting that solar will continue expanding global at a overly fast rate. They suggest growth drops into the 5-10% annual growth rate. I recall you having very clear opinions as to how 2011 was going to go and where global ASP would stabilize. Not saying that is going to happen again, but caution is a solar investors best friend. When I think about CSIQ and how they are not overly eager to expand wafer and module capacity (the expensive capacity) I feel they have to be thinking something similar.

 

Hopefully this does not end that way again as always remember that the market is looking much further out than either of us is. It  began discounting the value of CSIQ's Canadian projects 1.5 years before they finished them. Both of us were still drooling over how much we expected them to make the next quarter only to be cut down 20% when they destroy estimates.

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Most of the time you are predicting things exactly the way the market seen them in 2011/2012. World of dropping ASP and the module glut leading to stock prices in single digits. I say you have a tendency to see things that way with a rather high frequency.

I doubt you remember what I was saying during that time reading above post. I had a message of increasing demand for right companies and adjustment toward creating profitable gross margin. I kept saying this for years, and I have benefited from what I was saying for years in 2013 season. I also said that ASP for certain companies was not at the spot, and I was right. Nobody any more talks about spot prices and CN3 companies, if they want to be considered as serious, this is one of the lessons from that period. Second lesson was that CN4 grew in a glut, showing they were completely different in this turmoil. I do not remember you saying anything along those lines, but mostly lamenting about the markets.  

Now, the market is not looking anywhere that far in my view. You are making the same error in my opinion of seeing wisdom in a crowd/herd behavior.  The perfect example of crowd wisdom is SUNE. In reality the wisdom was a show of stupidity attracted by glitter of scale made from clay and paper talked up by some hedge fund managers. 

I have done a homework on this and so did Explo. It was not intuitive or tea leaves reading it was real wisdom.  I do not claim to be right going forward but I use the same methodology I have evaluated SUNE. In the long run I am able to beat emotional compass, while I need to practice my trades in a short term. I do quite well on one trade I made in last three months and hope to do my plan. Sometime not losing money is good enough.

Canadian has beat every single estimate we have made here including last quarter. If I was not clear let me say this again. The market does nothing to understand this company. However the illusion of link between SUNE and FSLR, SPWR and CSIQ lasted only one day (thus far) and this is a good sign. There is no wisdom there, I see an exploration of emotional condition by algorithms and people idolizing it as wisdom. I am not worried about emotional toss anyways. I mentioned already I evaluate companies differently, by reading their 10Qs and understanding accounting and operational abilities including my own experience in real situations of finance and operating businesses. What I do now, markets will catch 2 to 3 months later. Thus far it has been the case.

 I think thesis on Canadian is once again being reevaluated by the market. I think this revaluation is actually shifting to positive and undervalued for a stock. After all EPS means different things for companies, look at JASO and SPWR. 

Finally on the forecast. 5 to 10% of 60GW is 6GW, but 5.3GW to 4.3GW in sales is 25% volume growth. if you have 5 companies doing 5GW there are 35GW done by someone else. You do not only grow the scale but also take a market share. I am not really sure any more if I need to argue those points to anyone. Look at the one which grew the most and now is almost wiped out.

Happy Investing

 

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I have no intention in finding wisdom in the stock market. I have little interest in having the right or wrong opinion. I have one interest, in this regard, and that is making money. We have been over this before, and it is simply clear we each have very different motivations for investing in stocks.

But yes, happy investing.

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I think we have the same motivation, to make money, but clearly different paths and views on how to do it.

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One of these days Explo's vision about JASO may just happen.

When their share price finally gets in line with the companies performance....i hope i am onboard.

Explo....you still a JASO believer?

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37 minutes ago, Paybak66 said:

One of these days Explo's vision about JASO may just happen.

When their share price finally gets in line with the companies performance....i hope i am onboard.

Explo....you still a JASO believer?

Not Explo but I believe JASO will do well financially as a company. Unfortunately, I am not sure whether that will translate to better share price as it will be capped at $9.69 unless the sleazeball CEO and board bump up the offering price or are forced to do so. I sold 2/3 of my holding yesterday and wait for a miracle with the rest of share. Good luck to all who are long JASO.

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1 hour ago, Paybak66 said:

One of these days Explo's vision about JASO may just happen.

When their share price finally gets in line with the companies performance....i hope i am onboard.

Explo....you still a JASO believer?

Yes I'm still a JASO believer, but my exposure to a single stock these days is only a fraction of what it was a year ago. The JASO valuation case becomes clearer now as it is not just dominating low PS and PB now, but low PE too. Since this is combined with great sales growth its not a value trap case, i.e. there is plenty of other things to use the strong BS forming to than pay dividends. What may seem as a negative is that careful JASO has chosen to allocate its capacity short-term to third party instead of own projects. Maybe savvy to short-term build BS while big third party demand and unresolved payment issues in China.

 

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explo, just read your about me. How do you get 3x leverage on stocks and 6x on hedge funds? Are you using options or margin? Maintenance margin requirements on these solars is typically more than 30% isnt it? Great write up btw. Thanks for sharing, as always.

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1 hour ago, Scsnospam said:

explo, just read your about me. How do you get 3x leverage on stocks and 6x on hedge funds? Are you using options or margin? Maintenance margin requirements on these solars is typically more than 30% isnt it? Great write up btw. Thanks for sharing, as always.

Great,  that confirms that it is accessible to others (there seemed to be some confusion around this). 

The leverage is achieved with margin account and the level of it depends on the margin my broker allows for different stocks and funds.  The margin offered impacts capital allocation decision as I try to maximize levered return.

The margin offering works different here as it is just one level and not two with one for initial purchase and one for maintenance as I understand is common in the US.  

The high 3.33x leverage on "stocks" (now called "market") is achieved by mixing two parts individual stocks (allowing around 1.67x leverage) with one part mutual funds (allowing 6.67x leverage).

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JA Solar Wins Contract to Supply 100MW of Modules to One of the First Three Large-Scale Ground-Mounted Solar Power Stations in Zimbabwe: http://finance.yahoo.com/news/ja-solar-wins-contract-supply-024800725.html

The three projects involve a total PV module contract value of US$544 million, US$179 million of which was won by JA Solar.

1.79 $/W ASP?

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How can the company be considered serious if they cannot structure info properly? On the other hand doing business in Zimbabwe is apparently very lucrative for module sellers.

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OK, why did JASO pre Report? Any ideas out there? Reall strange move especially if the Chairman is trying to steal the company with that Low-Ball bid.

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looks to me like they're following the CSIQ playbook... good for them.  The damn wording is even the same "will exceed expectations"

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I wonder how Gordon Johnson will spin this! Cause you know he's going to try. I think he will go after the gross margins, only thing he can attack.

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9 hours ago, jamiecc said:

OK, why did JASO pre Report? Any ideas out there? Reall strange move especially if the Chairman is trying to steal the company with that Low-Ball bid.

Only if you think the company represents the chairman's interest instead of the shareholders' interest.

The beat is likely to boost the EPS with 10-15 cents.

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4 hours ago, jamiecc said:

I wonder how Gordon Johnson will spin this! Cause you know he's going to try. I think he will go after the gross margins, only thing he can attack.

Gross margin outlook now looks better than what they guided on the Q3 CC. I don't see how CN solars will not get a lift from this guidance beat.

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