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 CEO: Italy Risk Has Impact

NEW YORK ( TheStreet) -- A sign of the Italian impact on the solar sector was evident Thursday in comments released by U.S. niche solar player Energy Conversion Devices (ENER). The company estimated that as much as 50% of first-quarter revenue would be negatively affected by European solar incentive changes, and production needed to be dialed back immediately.

"The dramatic and abrupt shift in the French and Italian solar incentive structures has impacted our business and forced us to reconsider our near-term financial outlook," Mark Morelli, president and CEO of Energy Conversion Devices said in a statement aiming to temper expectations for near-term results.

Energy Conversion Devices shares were down 25% after hours on Thursday.

The Energy Conversion Devices CEO added, "Recent events have injected disruptive uncertainty into the markets, which is causing financing sources to put projects on hold and may impact as much as 50% of this quarter's forecasted revenue."

France has placed a temporary moratorium on solar installations as it hammered out the details of a new auction process for project awards linked to solar incentives rates. In Italy, wholesale changes to solar policy are expected within a month.

The Energy Conversions Devices CEO said, "We expect better visibility on the timing of our projects after the announcement of the new Italian feed-in-tariff program and the French tender process. Nevertheless, for the quarter ending March 31, 2011, we are reducing production to 25 megawatts and are also aggressively pulling back on our cost structure. Thus our financial results will be affected due to restructuring and factory underutilization charges."

Shares of Chinese solar company Canadian Solar (CSIQ - Get Report) led the entire solar sector down on Thursday, declining by more than 18% during regular trading.

There were a host of reasons for the solar selloff, from the renewed eurozone fears as Moody's downgraded Spain, to fears of a weakening Chinese economy with its trade deficit hitting a seven-year high. A bad day on the tape is a doubly bad day for high-beta plays like solar stocks, typically, too. However, on a solar-specific basis one of the biggest risks remains the changes being contemplated to solar incentives in Italy. The country has been the fastest-growing market in solar and in the fourth quarter, and was primarily responsible for high selling prices across the solar sector.
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
CSIQ $17.91 0.00%
AAPL $93.74 0.00%
FB $117.58 0.00%
GOOG $693.01 0.00%
TSLA $240.76 0.00%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs