XINYU City, China ( TheStreet) -- LDK Solar (LDK)disappointed in its earnings release on Tuesday morning. The backward-looking earnings shortfall, though, was less significant than a set of questions that dogged LDK Solar long before Tuesday, and that seemingly linger after the give-and-take between LDK management and analysts on the Tuesday conference call.
LDK shares ended down 7.8% on Tuesday, on close to triple the Chinese solar company's average trading volume -- 6.5 million shares traded versus 2.5 million shares.
It's possible that, given the general outperformance by many solar stocks in the fourth quarter, investors might have had unrealistic expectations for LDK. LDK gross margins were 9.9% in the fourth quarter -- half the third-quarter gross margin level of 20.1%.
Nevertheless, to put the weak fourth quarter into perspective, Gabelli & Co. analyst Hendi Susanto said he actually expected the gross margins reported by LDK to be worse than the actual margin deterioration.What's more, ReneSola (SOL),
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV