LDK's Sunny Outlook Bucks Solar Bears

A day after bearish notes from three securities analysts pushed already beaten-down solar stocks even further downward, one solar company fought back with sunnier guidance than analysts had been expecting.

LDK, a Xinyu City, China-based maker of multicrystalline solar wafers, boosted its outlook for the third quarter. It now expects to see revenue for the quarter coming in between $530 million and $540 million. Previously, its guidance had called for revenue between $486 million and $496 million. The midpoint of the new guidance marks a 9 percent improvement over the old figure and a 10 percent premium over the consensus.

The company had more good news for investors. It said wafer shipments were between 230 megawatts and 240 megawatts in the quarter, up from 210 megawatts-220 megawatts. And it had reached its estimated wafer production capacity of 1.2 gigawatts by the end of September, a full quarter ahead of schedule. Xiaofeng Peng, LDK’s CEO, said in a statement:

“Reaching our year-end annualized capacity target three months ahead of schedule and delivering better than expected financial results for the third quarter reflects our steadfast dedication to meeting the increasing demand for solar cells worldwide.”

A bland expression of enthusiasm, sure, but the finicky market liked it anyway. LDK’s stock rose $2.16, or 11 percent, to $21.85 in active trading Tuesday and was up another 2 percent in the aftermarket.

The company’s shares fell 3 percent Monday after Goldman Sachs, Wedbush Morgan and Piper Jaffray all sent out notes expressing caution over the solar industry, namely that capital and credit were becoming scarce and expensive, just as the market is about to tip into an oversupply of solar goods. The concerns about subsidies in Germany, Spain and elsewhere were rising again as government budgets are sure to dwindle.

Those longer-term worries are significant, but even a bit of short-term bullishness seems welcome in this market.

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