Real Goods Solar (RSOL) Spikes on Heavy Volume

Joel Anderson  |

Shares in American solar energy company Real Goods Solar (RSOL) popped over 40 percent Thursday without a readily apparent reason. The company announced that it had scheduled its Q3 earnings call for after market close on Wednesday, November 6, but did not release anything about the quarter’s results. The massive jump came on very heavy volume, with over 30 million shares trading hands for a stock with an average volume of about 2.25 million.

Upcoming Presentation, Earnings Call Could be Good?

In a classic game of “What does everyone else know that I don’t?”, investors and traders appear to be anticipating good news in Real Goods Solar’s upcoming earnings call that CEO Kam Mofid and CFO Tony DiPaolo will host. However, the explanation could also be technical. With some analysts and brokers anticipating big things for Real Goods Solar, the optimism may have started to overflow once the stock moved past resistance at $3.05 a share, a level it had flirted with and retreated from in the past. Regardless of why, the big spike took shares briefly above $4 a share.

The company has also announced that it will participate ROTH Capital Partners Solar Symposium with Tim Seamans, General Manager of the company’s commercial and utility division, set to take part in a fireside chat. Many traders familiar with the stock seem to believe this conference could mean big things for Real Goods, though it’s not entirely clear why.

May Spike, Long Decline

Shares of Real Goods have already been over $4 in 2013, spiking almost 250 percent to over $6 a share from May 16 to May 20. Once again, there wasn’t an easy explanation for the sudden spike given that the company released earnings a week earlier. It was, however, part of a mid-May spike that pushed up several other solar companies, including SolarCity (SCTY) and SunPower (SPWR) .

Real Goods also may have benefitted from a May 17 Seeking Alpha article that highlighted the company as a stock to watch because of its success in marketing solar panel installations to schools, lower expenses, a potential partnership with Lennar Corporation (LEN) , and a new line of solar modules. Volume also peaked 30 million shares on May 17, though, making it seem unlikely that a single article could be the primary motivating factor.

The spike didn’t stick as the stock slide back below $3 by mid-June.

Strong Year for Solar

Solar has been an industry to watch for all of 2013, with the Guggenheim Solar Trust ($TAN) clocking in as the top-performing non-leveraged ETF of the year. And market sentiment regarding the industry could also give some insight to the atmosphere producing these big spikes. SolarCity revealed that they had acquired Zep Solar yesterday while raising their guidance and has popped over 15 percent since. SolarCity also announced that it was anticipating an 80 percent increase in its installations in 2014, and the industry responded well. Industry leader First Solar (FSLR) is up over 5 percent since yesterday, and the Guggenheim ETF has jumped almost 4.5 percent over the same period.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

Companies

Symbol Name Price Change % Volume
SPWR SunPower Corporation 6.11 -0.20 -3.17 1,453,304 Trade
SCTY SolarCity Corporation n/a n/a n/a 0 Trade
RSOL Real Goods Solar Inc n/a n/a n/a 0 Trade
LEN Lennar Corporation Class A 40.21 -0.70 -1.71 2,370,678 Trade
FSLR First Solar Inc. 43.64 -1.66 -3.66 1,839,309 Trade
OMNT Ominto Inc. 0.80 -0.09 -10.11 1,004

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