This Day On The Street
Continue to site right-arrow
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
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Pay Attention When Wall Street's Biggest Solar Bear Gets Nervous

Stocks in this article: FSLR YGE PWER STP TSL

NEW YORK ( TheStreet) - When the biggest solar stock bear on Wall Street -- an analyst selected by CNBC for one of the "shorts of the year" in 2011 -- gets nervous about sell ratings on solar stocks, pay attention.

A report from Deutsche Bank suggesting that solar demand may improve more than expected in 2012 and that pricing may stabilize led to a monster rally in solar stocks, but that report may not be the most telling read from the solar analyst ranks.

If you don't trust Deutsche Bank, you might want to take a look at the flurry of reports put out by Axiom Capital analyst Gordon Johnson -- sent with red exclamation marks in the email subject line -- removing his sell rating on five solar stocks, including First Solar (FSLR) -- the aforementioned "short of the year" and a stock which he just lowered his price target on last week, to $26. First Solar rallied to above $42 on Wednesday.

When Johnson lowered his First Solar price target but commented in the change that the First solar short had "almost run its course," one peer solar analyst commented that it was as good a sign of a bottom in solar as any other data point.

And that was before it became known on Friday afternoon that Germany had installed 7.5 gigawatts of solar in 2011 thanks to a huge fourth quarter, a typical short-term frenzy driven by declining subsidies in the world's biggest solar market. The subsidy-driven trade in solar may be a signal of much that is wrong with the economics of the sector, but it's also always been a driver of trading and short-term gains in solar shares.

Johnson removed sell ratings on First Solar , Yingli Green Energy (YGE), Trina Solar (TSL), Suntech Power (STP) and Power-One (PWER).

He didn't move to a buy, but moving to a neutral was enough to signal that the great solar short may have run its course -- or at least this course of the great solar short may be completed.

The rationale provided by Johnson for moving to the sidelines on solar stocks was good evidence of the prevailing solar bearishness swinging back to a more optimistic view, at least as a near-term trade.

1 of 3

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

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
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, 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
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs