Friday, April 15, 2011

Solar's Trina (TSL) (JASO) (YGE) Wobbly as Industry Staggers

It's becoming increasingly obvious that the solar sector is crumbling, as the high costs of the industry, even with government subsidies, is unsustainable, as even in solar-friendly China firms like Trina (NYSE:TSL) JA Solar Holdings Co. (NASDAQ:JASO) and Yingli Green Energy (NYSE:YGE) are under pressure.

This stupid idea by certain elements of the media with agendas, that keep on harping on the unprecedented earthquake in Japan causing problems with some of the nuclear reactors in the country as some type of nod toward solar is asinine.

The same thing is being said about every other energy source outside of nuclear too. Of course that's going to be the short-term response. There could be no other.

But other than shoring up safety measures and doing the best they can, energy producers will continue on with nuclear development, as demand ensures it.

The fact that European countries that want to produce solar aren't able to afford to subsidize it any longer reveals it's simply a nice "green" idea that doesn't work. Period!

Wind is increasingly becoming suspect as well, as evidenced in the Pacific Northwest, where the power grid is pushing back as grid limitations could force Pacific Northwest wind power producers to shut down operations. It could get much worse, and may never get better. Quit the taxpayer subsidies now.

The bottom line is alternative energy isn't alternative at all, but like a little toy used to pacify those obsessive in their opposition to existing energy sources which work, wind and solar don't work, and they need to be cut lose from any government support, so if there is any viability in them at all, the market will sort it out and the companies will be forced to innovate to make it work.

Oh yeah. This wind turbines kill hundreds of thousands, and probably millions of birds and bats around the country; far beyond the relatively small amount harmed by the BP (NYSE:BP) oil spill.

Trina Solar closed Thursday at $29.52, falling $0.11, or 0.37 percent. JA Solar Holdings closed at $6.43, dropping $0.125, or 1.91 percent. Yingli Green Energy closed at $12.16, down $0.13, or 1.05 percent.

18 comments:

Singing Competition Montreal said...

This is a totally ignorant, non factual and partisan article. The author of this article has no idea about the natural evolution of the things that BENEFIT our well-being and our lifestyle. The idea in which even if it costs more at the beginning, it's our duty to pursue it so that our lives are improved. Take Internet for instance. This person is also using the method of a generalization to avoid the factual arguments. Sure there could be some regional failures along the way. But, the efforts being made in the renewables are in the right directions and will make our lives better (it already has in so many ways!). We just have to ignore these people who are confused between their short-sighted interests and what's good for them.

Anonymous said...

Likely he is ignorant for a reason - maybe he sits on shares of TEPCO, Arreva, uranium miners, or worse, is part of the solar short about to blow up.

And I agree with you - better to spand a bit more on renewables than to get nuked, like the poor guys in Japan.

Anonymous said...

I agree with comments of chingu. Ray is ignorant and totaly irresponsible with his article. We need so much to care about our beautiful planet in everything what we do and say. To work out solutions for clean energy it starts with the attitude of each single citizien of our earth to respect and preserver our nature.

Very sadely Japan is the 3th major accident after Kyshtym and Tschernobyl. Is this not enough for learning the lessons?

Anonymous said...

It's clear this person has a short interest in solar. What a ridiculous article.

Anonymous said...

This is pathetic, you are ignorant and moronic, and you are wrong.

Alan said...

I've had it with these whiny liberals like Ray that are only concerned about the lives of birds and bats. Crows are pests! More wind power!!! (Kidding)

Sad thing is, Ray, your kind of one-sided crap is what passes for journalism these days. Showed up as the top link for JASO on Yahoo Finance. Pretty lame.

m said...

pathetic.. ever heard of michio kaku? well hes a brilliant theoretical physicist. Ever heard of albert einstein? yep.. well all the ignorant fools said things just like this article until one day he proved the all wrong. Know anything about calculus what is the limit of a finite resource (natural resources) as source goes to infinity (consumption)... the answer is 0..ZERO!!! then take for instnance something like the wind which is sinisoidal, or sun which is linear (because one day it will cease). UMMMM... people are going to start killing each other for oil in our lifetime... oh wait that already happens.. but the sun and the wind is damn near free.. Sure this technology might not be as well developed as an oil rig.. but, we will still have lights and cars and blenders and ovens when your stone age ass is wondering where everything went after you used it all.. Fuck off sir and stop polluting the planet with your ideas and your dirty energy

Anonymous said...

Ray where do you come from and where have you lived the last 20 years?
Not on planet earth for sure!!
Go back where you came from and bring all the idiots like you!

Anonymous said...

Why does Google publish this garbage and send it out as news links? Clearly this individual has some sort of mental defect.

Anonymous said...

The markets agree with his comments, but I believe this is because at the moment, only at the moment, alternative still has price and efficiency challenges. This will, however, change over the coming years and I suspect, dramatically, as innovation makes solar, hydro, and other alternatives the primary source of energy. After all, what is the alternative? Burn more oil? Nuke ourselves? Alternative is really the only sensible alternative.

Green Ray said...

I agree, solar and wind at this moment are not matured to be the "alternative" and, unfortunately, may not be able to become "matured" at all. There are other alternatives under developing like biomass gasification etc. ... I believe pv (solar) and wind will have there position but would not be the winner. Nuclear is getting saver and it will be there.

noel said...

Solar is on the cusp of grid parity, A new revolution of green energy is going to happen like the PC revolution of the late 90's.
Nuclear & Oil has always been subsidized and the damage is immense from Global warming to Chernobyl and fukushima. I believe most consumers would pay a little more for electricity to know that it is sustainable and doesn't damage the environment.

curt0 said...

Bears or short sellers continue to nitpick solar stocks to death for the past 1-2 years. If it isn’t subsidies, it’s over-supply or something. Yet:

Revenue growth from 2009 to 2010:

JASO: 211%
Netflix: 30%
Akamai: 19%
Amazon: 40%
Apple: 52%
Google: 24%
Baidu: 78%
Salesforce.com: 21%
Oracle: 15%

Revenue growth from 2007 to 2010 (approx.):

JASO: 337%
Netflix: 79%
Salesforce: 121% (Fiscal YE is on end of Jan)
Apple: 165%
Amazon: 131%

Net Income growth from 2007 to 2010 (approx.):

JASO: 338%
Netflix: 141%
Salesforce: 251%
Apple: 301%
Amazon: 142%

They continue to nitpick the trees instead of looking at the forests. It’s purely unbelievable.

P/E:

JASO: 4.12
Netflix: 79
Salesforce.com: 282
Apple: 18.5
Amazon: 71

JASO gave explosive, crystal-clear guidance for 2011 that is backed by law (50% growth in 2011 with 90% of the 2011’s sales already under contract). How many companies can say that? Please name one.

Can you show one non-solar company with numbers similar to JASO’s? Just one??? I’ve asked Herb Greenberg of CNBC and Eric Rosenbaum of TheStreet this question, but no reply. Nobody can name one company!

Why do these bears continue to be wrong and continue to bash?

One plausible explanation for this, is manipulation. Read more:

http://seekingalpha.com/instablog/872074-curt0/143971-is-wall-street-manipulating-solar-stocks

I can’t think of any other plausible explanation.

Anonymous said...

I have an idea about the value of this article. I too think that the author is supporting an ignorant and destructive attitude towards our necessary evolution...but look at how well it unites all of us with more optimistic ideas about our future and our potential. As discouraging as it is to hear such a destructive point of view passed as news, it is equally encouraging to hear how active people are in expressing their differing ideas about what our direction should be. It is our future and it is up to us define it through our ideas and actions. We all have the power to be the change we want to see in the world. Let's redefine our paradigm!

Roger said...

I got a lot of money in Jaso, i lost alot in the past two weeks. Should i hold or sell, articles like this get me worried whether it was a smart move to invest in solar. Almost 80% of the analysts were ravong anout alternatives during japan's tsunami and into the mid east crisis. Now, most are becoming silent and im reading articles like this, what gives? Can any analyst direct me to some speculation backed up by facts to assure me that staying long with Jaso is worth it? Can we see higher than $8 per share by the end of the year? I think today was $6.20, thank you to all who respond.

Anonymous said...

sounds like something I'd try to propagate in order to lower the price, in order to buy buy buy for the long term. The bears are only crying out the negatives in order to find the bottom, sort out the real players. If it weren't for this guy, I wouldn't be able to play this whole buy low-sell high game. The longer they wait to realize the obvious, the longer I have to pull some profits. I need this quarterly roller coaster, so keep coughing up this nonsense. It's true that the price will have to come down, and countries will eventually be ending their subsidies. Those bumps'll get smoothed out in the long term. p.s. How long has the Agricultural industry been subsidized? Big oil? Ethanol? ... p.p.s. Its been stated recently that the BP spill will be of worse consequence to the world's environments than the Fukushima Daiichi nuclear disaster. Write about subsidies and media hype for one energy source over the other, but don't for a second try to compare windmill bird strike to BP oil and dispersants settling into Earth's ecosystems and your food web. And lastly,... when was the last time you bought some gasoline for your car,... and never had to buy it again? That's what I hope to one day accomplish with my house and renewable-energy-TRULY-power- to the people. The alternative energy revolution is first a social one, and then it is a political/economic revolution.

Anonymous said...

Obviously no one can "tell" you where jaso is going. I believe in the solar sector as well...and I'm long jaso. If you look over the past two years jaso stock is doing pretty well. When I discovered it it was trading aroung $2.00, so things are good, right? And since that time it has done nothing but increase it's sales and production, and the p/e ratio has done nothing but fall. And market share? I'm not sure exactly, the whole sector has grown a lot, but I think it may have improved. So obviously all of us who are long jaso are looking for the expected positive adjustment to manifest.

I think that there are valid reasons that jaso is facing such perceptual challenges. My understanding is that jaso's business approach is broad horizontally but narrow vertically. They are mostly in the business of manufacturing cells...and lots of them, but it seems that their margins are at risk of being squeezed from above and below...ie oversupply and lower asp's and higher silicon and wafer prices. So they seem to be in a somewhat vulnerable position. Then there are the fierce headwinds from entrenched interests and their powerful influence in framing the political debate and influencing peoples perception of the sector, as well as the downward pressure coming from the many short sellers. Another negative factor is the fierce competition. Warren Buffet would probably have a serious problem with the complete lack of any kind of protective moat in the solar industry, except for maybe a small one around first solar.

Countering all that negativity however are some underlying realities. People have an appetite for energy and that is almost certainly going to grow significantly barring catastrophic events. I think the demand for energy will continue to increase at a very rapid rate because we have enormous populations that are coming online as affluent consumers...India, China, and their will be more to follow, SE Asia, Central and South America. Everyone wants the same affluence that the west has enjoyed and vast numbers of people are beginning to have access to it.

Couple the potential growth in energy needs with the fact that our current system is experiencing some major and unresolvable growing pains and, in my opinion, we have the potential for an explosion in demand, which we may be seeing already with the powerful growth that the industry has been experiencing. I think we need to be ready to let go of our ideas about who we think the winners will be and be prepared react to who the real winners become. So many of these companies will either fall or merge and we need to be prepared to jump on the right boat if ours sinks...but at the moment their seems to be room for almost everyone.

Anonymous said...

Re: JASO tanking- peole are worried about inflation in china causing more tightening measures and therefore less investment in china. I read once that during the inflation of the 70's, investors were demanding super low p/e to invest n a stock. I didn't verify , bt maybe that's what's happening in china. Also remember the accounting fraud scare re chnese stcks. It's definitly putting pressure on them. Oh yeh , and don't forget the repugs wanting to take money out of the economy. Even repug investors know that isn't good for stocks or the economy.
Look at the "no money upfront " solar installs. 18 years same price every month. Even without subsidies, that monthly charge could well be muc less than what you'd pay in , say ,5-10 years to the utility co. Also solar s much more cost effectve in developing countries where there is no grid paid for by MASSIVE GOV'T SPENDING and SUBSIDIES.