NEW YORK ( TheStreet) -- Jinko Solar (JKS) shares are experiencing a big selloff on Tuesday after Goldman Sachs initiated on the Chinese solar stock at a sell citing earnings vulnerability as the solar sector slows in 2011.
The Goldman analyst wrote in the Jinko sell recommendation, "We believe JKS is a marginal capacity player that entered the branded PV module market with less than two years history.... Jinko has anticipated the demand and price upcycle in 2010, and has announced aggressive expansion plans for 2011E. With a newly acquired customer profile, we expect JKS to face stronger headwinds during an industry downcycle on margin compression and earnings vulnerability."
As part of its tier-one versus tier-two players thesis, Goldman also judges Solarfun Power (SOLF) to be a tier-two Chinese module maker set for a more difficult set of circumstances in 2011. Goldman initiated on Solarfun at a hold.
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