Environment

First Solar (FSLR), Solar Stocks Down on Sell-Off

October 8, 2013

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2 min read

Solar stocks were on the move Tuesday, tumbling along with the market as the Guggenheim Solar ETF ($TAN) was off almost 2.25 percent and the Market Vectors Solar Energy ETF ($KWT) lost over 2.25 percent. Some of the segment’s biggest players joined the sell-off, with First Solar (FSLR) off almost 3.5 percent, SunPower Corporation (SPWR) down over 4.5 percent, and Yingli Green Energy (YGE) falling over 4.25 percent.

Sell-off Amid Uncertain Market

Both American and Chinese manufacturers appeared to be affected by the sell-off, which came amid the second-straight day of losses for the Dow, S&P, and Nasdaq. It also comes after news last night that a bankruptcy trustee for Energy Conversion Devices, Inc. would be suing three Chinese panel makers, Trina Solar, Ltd. (TSL) , Yingli Green Energy, and SunTech Power Holdings (STP) . The lawsuit alleges that the three companies conspired to export more than 95 percent of their product in a price-dumping scheme that resulted in the bankruptcy of Energy Conversion Devices. Trustee John Madden, who filed the suit, is seeking the equivalent of Energy Conversion’s book value, some $950 million.

Rough Day Amid Strong Year

The losses on Tuesday could just be a speed bump as performance by solar companies have been extremely strong in 2013. The Guggenhaim Solar ETF is the best-performing non-leveraged ETF so far in 2013, gaining over 125 percent.

ReneSola (SOL) Bucks Trend on Upgrade

Not all solar stocks took a hit, though. ReneSola Ltd. ($SOL) gained almost 9.5 percent after an upgrade from Zacks Equity Research. Zacks upgraded ReneSola to a strong buy, its highest rating, citing ReneSola’s superior position to deal with oversupply and the current trade-war between Chinese and America.

“With most of its solar peers in trouble due to an oversupply of solar panels, ReneSola seems to be in a better position with multiple contracts and agreements,” said Zacks analysts. “The company is a prominent player in the U.S. solar market. Despite the implementation of countervailing duties and anti-dumping duties on Chinese solar products by the U.S. government, the company is regularly winning contracts in the U.S. due to the high standard of its products and services.”