This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Barclays Gets Bullish on Solar

NEW YORK ( TheStreet) -- Barclays is out with a more bullish call on solar demand for 2011 on Wednesday, raising its outlook for solar stocks broadly, and saying current discounting of stocks misses the mark in trying to peg the true demand outlook.

Barclays thinks that the solar industry will grow 20% year over year, while average sales prices decline 15% -- more or less the consensus expectation for ASP declines. The bullish call from Barclays is predicated on the fact that current solar pricing reflects the 15% decline in ASPs, but in a flat demand environment.

Barclays is pegging 2011 solar demand at 16 gigawatts, versus a consensus demand call of 13.7 GW.

Barclays expects "greater supply of low cost solar panels, improving profitability of downstream players, additional cost reduction potential of low cost supply and 'rush' to complete installations ahead of subsidy cuts to drive demand upsides over the next few quarters."

Barclays argues that the solar stocks that it covers are capable of absorbing additional 15% price declines in 2011, and the downside risk to a demand falloff or bigger ASP decline than expected are limited.

Part of the Barclays' view is that as solar demand moves away from Germany and to markets with higher subsidy levels, the blended subsidy levels could decline at a slower rate than ASPs, improving the outlook for downstream players in solar. Such a scenario would create higher returns for solar project investors, and stimulate demand.

The Barclays bullish outlook in a stock-specific context highlights Trina Solar (TSL - Get Report) and Solarfun Power (SOLF) as the module players with the most near-term opportunity to move up. Trina was upped from a hold to a buy at Barclays.

In any event, all the solar module makers received a price target upgrade from Barclays, except Yingli Green Energy, which remains at a target of $14. Trina received the biggest boost on a percentage basis, from $21 to $30. Trina shares were up close to 5% on Wednesday morning.

Among wafer players, Renesola (SOL - Get Report) received a boost from $10 to $12. Barclays upgraded ReneSola to overweight. Along with Trina, ReneSola was the only other solar stock to not just see its price target raised by Barclays, buts its rating taken up from hold to buy.

ReneSola was only up 3% on Wednesday morning, but among solar stocks, it was seeing the most volume, surpassing its average daily trading volume of 1.5 million shares within an hour of the market open.

Barlclays also upped its price target on First Solar (FSLR) from $126 to $140.

-- Written by Eric Rosenbaum from New York.


1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
SOL $1.30 0.00%
TSL $9.70 0.00%
AAPL $117.81 0.00%
FB $105.45 0.00%
GOOG $750.26 0.00%


Chart of I:DJI
DOW 17,798.49 -14.90 -0.08%
S&P 500 2,090.11 +1.24 0.06%
NASDAQ 5,127.5250 +11.3820 0.22%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs