NEW YORK (
) -- Barclays Capital boosted its rating on three solar companies to overweight coming into trading Monday, and the shares in the sector stayed on a torrid pace throughout Monday's trading session.
Barclays raised it outlook for
Barclays said that it sees an inflection point for estimate revisions in the case of Suntech and raised its price target to $20. Barclays raised its 2010 earnings per shares estimate for the company to 80 cents, above the Street consensus of 66 cents.
Suntech was up just short of 11%, or $1.66 to a close of $17.05 on Monday.
Barclays also raised its price target on JA Solar from $4 to $6 and noted that with shares trading near book value and potential for positive earnings revisions in the next few quarters, the risk-reward profile of JA Solar now seems attractive. Barclays predicts 2010 earnings of 40 cents per share driving upside to $6, or 15x the 2010 book estimate, and sees downside risk limited to $4 or 1x book value.
JA Solar was up 12.5% or 55 cents to a close of $4.95 on Monday, and was among
the Nasdaq most active stocks in the pre-market on Monday.
In the case of SunPower, which is the most controversial play in solar right now, given the accounting scandal hanging over its head, Barclays believes that the hit SunPower shares have already taken "are largely discounting any potential accounting related concerns and not fully reflecting the near-term demand environment as well as longer-term prospects of SunPower's business model."
Pacific Crest Securities also
recently upgraded SunPower,
though some analysts argue that the accounting problems could be worse than most analysts anticipate.
SunPower was up just short of 10%, or $2.14 to a close of $24.45 on Monday.
-- Reported by Eric Rosenbaum in New York.
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