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42 minutes ago, solarpete said:

stop trying to forcibly extend the life of the coal industry, when consumers don't want it any more.

I was sickened when my Fox News fan, Trump voting, father-in-law told me a couple weeks ago that he was excited to have bought some coal stock that pays a nearly 12% dividend.  So not only are we forcibly extending the life of coal, we're turning those subsidies around and letting them pay out a fat dividend to help keep these companies relevant too.  My only comment on that when he told me it paid a 12% dividend was "yeah, for now it does".  I moved the conversation on to something else, not wanting to start a war on the first day of our joint vacation.

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I'm with you.  I don't understand how people can think like this, and because I can't follow their logic (or rather, lack thereof), I start speculating about their motives.  And that's when I, too, steer the conversation elsewhere if it's with someone I care about.

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2 hours ago, Mark said:

I was sickened when my Fox News fan, Trump voting, father-in-law told me a couple weeks ago that he was excited to have bought some coal stock that pays a nearly 12% dividend.  So not only are we forcibly extending the life of coal, we're turning those subsidies around and letting them pay out a fat dividend to help keep these companies relevant too.  My only comment on that when he told me it paid a 12% dividend was "yeah, for now it does".  I moved the conversation on to something else, not wanting to start a war on the first day of our joint vacation.

I am curious which stocks he invested in and how it has performed? The coal index is down nearly 50% from the highs of last September. While it is a big dividend and many companies did 1 time cash distribution that pushed the dividends last year to over 20% for some, the stock price crash would have wiped out that in value and then some.

 

https://www.suredividend.com/best-coal-stocks/

https://www.marketwatch.com/investing/index/djuscl?countrycode=xx

 

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1 hour ago, SCSolar said:

I am curious which stocks he invested in and how it has performed?

ARLP - I don't know where he bought in, but it was recently, so he hasn't lost principal... YET.

 

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So we're 11 days into the second half of 2019.  Fair to push the panic button on solars based on the EnergyTrend and PVI data today?  I dumped nearly all of both this morning, but isn't this a bit extreme for demand that's not really expected to kick in until later?  I'm not interesting in buying anything back at this point, just wondering how bad today's news really is.

There's also this: https://www.reuters.com/article/china-solar-subsidy/update-1-china-sets-2019-subsidies-for-large-scale-solar-power-projects-at-248-mln-idUSL4N24C1XN

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13 minutes ago, Mark said:

Fair to push the panic button on solars based on the EnergyTrend and PVI data today?

So that's what's causing the solar selloff across the board.  Was wondering what the heck was going on....

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18 minutes ago, Mark said:

So we're 11 days into the second half of 2019.  Fair to push the panic button on solars based on the EnergyTrend and PVI data today?  I dumped nearly all of both this morning, but isn't this a bit extreme for demand that's not really expected to kick in until later?  I'm not interesting in buying anything back at this point, just wondering how bad today's news really is.

There's also this: https://www.reuters.com/article/china-solar-subsidy/update-1-china-sets-2019-subsidies-for-large-scale-solar-power-projects-at-248-mln-idUSL4N24C1XN

So, if numbers are correct in this article, China is still going to have min 45GW this year installed... Am I mistaken?

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1 minute ago, MVA said:

So, if numbers are correct in this article, China is still going to have min 45GW this year installed... Am I mistaken?

You're not mistaken, but they may be.

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25 minutes ago, Mark said:

You're not mistaken, but they may be.

PV indexes show us today that PV Module prices are still relatively stable, but Cell prices are falling. I see two reasons:

1) Tier 1 module producers increase cell share production in their vertical structure. CSIQ as an example. Hence no need to buy more cells than before.

2) Delay in China H2 installation boom. Which now, after National Energy Administration (NEA) finally approved subsidies for solar power projects equal to 22.79 GW, should start very soon.

Canadian solar, for instance, having Modules sales in China only at the level of 10%, benefits again, like in 2018, from cells depreciation.

Next ER in August will show us again substantial margin increase, because of cheap Chinese components (cells).

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There's no question the article is very bearish regarding Q3 outlook, the title says it all.  Not even Kellyanne can spin this positively.

Interesting to see how fast market sentiment changed in China, only a few weeks ago Energytrend claimed there would be no off-season in H2:

Price Trend: Market Atmosphere Is Optimistic, and There Will Be No Off-season in 2H19
https://www.energytrend.com/pricequotes/20190606-14100.html

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On ‎7‎/‎13‎/‎2019 at 12:10 AM, Klothilde said:

There's no question the article is very bearish regarding Q3 outlook, the title says it all.  Not even Kellyanne can spin this positively.

Interesting to see how fast market sentiment changed in China, only a few weeks ago Energytrend claimed there would be no off-season in H2:

Price Trend: Market Atmosphere Is Optimistic, and There Will Be No Off-season in 2H19
https://www.energytrend.com/pricequotes/20190606-14100.html

Here's the salient sentence from the article:

"In terms of the supply and demand in the next few weeks, it is difficult to see an optimistic trend; in the future, the prices will continue to be affected by the market’s supply and demand."

First, it's a bit of a stretch to call "difficult to see an optimistic trend" the same as "very bearish."  And it's outright fabrication to call it "a giant sucking sound."  That's the kind of "interpretation" I expect to see on Fox "News."

Second, weren't you the one educating us all on the importance of the long-term outlook to the market earlier this year?  So why the sudden concern over the next few weeks?

Third, and most importantly, this article was released the same day China announced its new subsidy policy.  The data in the article therefore does not include the effect of that new policy.  I just read an article on Yahoo Finance that says China is now expected to install 40-45 GW this year, and that they installed only 5 GW the first half.  That leaves a huge backlog for the next few months.

Give it 30 days for the new policy to take effect, and then let's see what the data shows.

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49 minutes ago, solarpete said:

I just read an article on Yahoo Finance that says China is now expected to install 40-45 GW this year, and that they installed only 5 GW the first half.  That leaves a huge backlog for the next few months.

This is why China articles are not reliable. Jinko themselves and other articles indicated that Q1 installes were at 5.2GW in the first quarter alone.

 

https://seekingalpha.com/article/4272691-jinkosolar-holding-co-ltd-jks-ceo-chen-kangping-q1-2019-results-earnings-call-transcript?part=single

 

Gener Miao

" Due to later than expected announcement of this year's policy, total PV installations in China were only 5.2 gigawatts in the first quarter. "

 

I have read articles  that suggest Q2 demand is lower than Q1 in China as they awaited policies That would peg CHina build outs around 8-10GW in the first half. 

 

I think you need to start looking at market shares.at15GW, Jinko is suggesting 12.5% global market share. You would think they would be more in their own back yard. A 10% share of the 40-45GW is 4-4.5GW from China.  A 25% of shipments to China for the year, is 3.75GW.

Looking at China demand year to date, a 10% share of the 8-10GW first half demand is 800MW-1GW in the first half. The second half would then suggest they need to ship 2.75GW ro 3.5GW in Q3/4.

 

I believe Jinko indicated that China bookings were 70% for Q3 at the time of the con call. They suggested Q4 bookings was less than Q3 but they expected Q4 to be stronger..

 

If you take the comments that Jinko expects Q4 to be better than Q3 then model 40/60%. At 3.25GW  that is 1.3GW in Q4 and 1.95GW in Q4.  At 70% booked for Q3, they had about 900MW booked and needed around 400MW more to reach 100% of expectations for Q3. That is bookings they needed  to get in Q3 for Q3. The Q4 bookings would be less than 70%, ets speculate 50%. That leaves them needing 1GW of bookings for Q4.

 

As you can see based on guidance and estimates for demand from China and market share, JKS is suggesting potentially 40% of their module shipments going to China in the second half with around 1.4GW-1.5GW or so needing being booked in the second half. 

 

This level of China demand is going to impact their ASP in general significantly compared to Q1/2 as the China ASP is about 3 cents lower than the average ASP. The Q3 module ASP being in decline suggests the demand from the 20-25GW of FIT based modules has not hit for Q3 in part due to the late policy. This should  create a generally lower ASP than originally expected. Their Opex will likely beneifit on a lower per watt cost  due to the quantity of low cost  local shipping and increased volumes.  This would suggest that a lower ASP and a lower Gross margin would not have the direct 1 to 1 correlation due to the lower shipping costs offsetting the lower GM.

If you read the policy, it is written with timelines that the projects would be built within 6 months or the FIT gets lost. This will create a demand rush with urgency to get them built. The problem with that is the FIT timeline is now pushed into 2020 for completion. This would put a good portion of that 20-25GW as not built in 2019. This might be why GCL was suggesting 35-40GW recently. This would also suggest that the 14GW range is probably more likely than the 15GW as of now.

 

In general, the soft ASP is in part due to lack of demand for modules due to the late policy which was inline wiht the time frames JKS pointed to(late July or August). This gets combined with the typical China issue of ramping now to drive down costs. The mono PERC module ASP spread to Multi has been to steep to justify the Mono purchase over Poly.. It is only natural that the Mono Perc would continue the ASP slide to push the demand. That is the issue with China policies is they are clearly a ramp and push to drive down costs to meet targets.

 

In general the fodder is much to do about nothing as the lower ASP/GM will be compensated for in increased volumes in the second half  and regionality of shipments leading to lower average Opex per watt compared to Q1 and Q2.

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2 hours ago, SCSolar said:

This is why China articles are not reliable.

Yes, it's hard to know what to believe these days.  But the article I read is from Zack's, not China, although they do quote Chinese data:

https://finance.yahoo.com/news/3-solar-stocks-set-benefit-142002815.html

Here's the quote:

"According to China’s National Renewable Energy Centre (CNREC) data, in the first half of 2019, China installed 5.2 GW of solar photovoltaic (PV) capacity, reflecting a 40% decline. Naturally, Chinese solar panels and cells manufacturers along with overseas solar players engaged in Chinese projects suffered.

The latest subsidy provision is expected to boost profits of these solar players in the coming days. This is because, with the removal of the cap on solar projects, the nation will witness construction of new projects."

Zack's is touting Enphase, CSIQ, and JKS.  Enphase is a completely separate story, with their emphasis on integrated smart grid technology.  And in the past, I've found Zack's to generally be late to the ballgame--by the time they recommend a certain stock, that stock is about ready to head south again.  So I wouldn't put too much emphasis on their analysis of CSIQ and JKS.

I think the bottom line is, no one knows what's going to happen in the next quarter.  Demand SHOULD pick up.  But as you point out, ASPs may still decline.  But if that decline is no faster than the ongoing decline in costs, margins will remain stable.  If so, the increased volume should actually drive profits again.  The problem is, that's a lot of "ifs."  You can make arguments for a rosy scenario, or a lousy one.

We shall see....

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35 minutes ago, solarpete said:

Yes, it's hard to know what to believe these days.  But the article I read is from Zack's, not China, although they do quote Chinese data:

https://finance.yahoo.com/news/3-solar-stocks-set-benefit-142002815.html

Here's the quote:

"According to China’s National Renewable Energy Centre (CNREC) data, in the first half of 2019, China installed 5.2 GW of solar photovoltaic (PV) capacity, reflecting a 40% decline. Naturally, Chinese solar panels and cells manufacturers along with overseas solar players engaged in Chinese projects suffered.

The latest subsidy provision is expected to boost profits of these solar players in the coming days. This is because, with the removal of the cap on solar projects, the nation will witness construction of new projects."

Zack's is touting Enphase, CSIQ, and JKS.  Enphase is a completely separate story, with their emphasis on integrated smart grid technology.  And in the past, I've found Zack's to generally be late to the ballgame--by the time they recommend a certain stock, that stock is about ready to head south again.  So I wouldn't put too much emphasis on their analysis of CSIQ and JKS.

I think the bottom line is, no one knows what's going to happen in the next quarter.  Demand SHOULD pick up.  But as you point out, ASPs may still decline.  But if that decline is no faster than the ongoing decline in costs, margins will remain stable.  If so, the increased volume should actually drive profits again.  The problem is, that's a lot of "ifs."  You can make arguments for a rosy scenario, or a lousy one.

We shall see....

I do not trust Zacks. When they first started covering solars a decade ago, they had spellings typos and incorrect information. It was not of quality and none of the research I have read from them is of in depth quality.

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