Trina Solar to Split Stock

CHANGZHOU, China (TheStreet) -- Trina Solar (TSL)is changing the ratio of its ordinary shares relative to American depository receipts (ADRs), in a move that could spur more trading in the Chinese solar stock. Trina is bringing the ratio of ordinary to ADR shares down from 100-to-1 to 50-to-1.

In essence, Trina is splitting its stock. The move is not surprising, given that Trina has among the lowest share-counts in the solar industry. As with any stock split, the overall value to shareholders won't change -- they will just own two shares at $30 each as opposed to one share at $60.

Trina closed at $59.14 on Tuesday and was up marginally in the pre-market Wednesday.

Analyst Adam Krop of Ardour Capital Management said that while he didn't think Trina necessarily needed to make this move -- Trina had arguably the best third quarter earnings in the solar sector -- it makes sense from the perspective of attempting to increase the number of shares in the open market and potentially spur retail investors to trade Trina Solar shares. "It will make Trina more liquid, and allow investors to trade Trina at a lower price, which could make the stock more attractive to some retail investors," Krop explained.

Shares of some of the cheaper Chinese solar players, such as JA Solar(JASO), have traded strongly in recent months. JA Solar, for example, has 167 million shares outstanding. Trina's closest competitors in the Chinese market, Yingli Green Energy Holdings(YGE) and Suntech Power(STP), have 155 million shares and 127 million shares outstanding, respectively.