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

Solar Losers: GT Solar, Jinko Solar

(GT Solar secondary story corrected for controlling shareholder information)

NEW YORK ( TheStreet) -- GT Solar (SOLR) announced on Friday morning that controlling shareholders had completed a secondary offering of 11 million shares priced at $7.39. The deal was completed on Thursday, as was a decline in share price.

GT Solar shares ended Thursday down 3% to the price of $7.39, at which the secondary was priced. Shares of the solar company slumped near 16% this week after the secondary filing was first made on Tuesday.

For GT Solar, the larger secondary offering overhang on its stock isn't done yet, though it's not a new issue of common shares from the company that always leads to share dilution.

Two venture capital investors hold a stake of roughly 77 million GT Solar shares. Back in March, the GT Solar financial backers unloaded 25 million shares of the solar equipment maker when they held more than 100 million shares, which led to a 7% decline in GT Solar shares.

For GT Solar, the share overhang remains a significant issue, even after the latest controlling shareholder sale. The venture firms are far from done exiting GT Solar. Venture capital investors selling shares en masse, and at a discount to current share price, is always an issue for investors.

Analysts say it is reasonable to expect the secondary offering to be priced at a discount, maybe as much as a 10% discount, to current share price. Venture capital secondary offerings are distinct from new common shares and GT Solar gains nothing from the proceeds of these secondary deals, but they do increase the number of shares trading at a discount.
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
JKS $20.08 -4.20%
TSL $9.54 -1.65%
AAPL $94.02 -2.67%
FB $104.07 -5.81%
GOOG $683.57 -3.45%


Chart of I:DJI
DOW 16,204.97 -211.61 -1.29%
S&P 500 1,880.05 -35.40 -1.85%
NASDAQ 4,363.1440 -146.4150 -3.25%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs